The EU Commission has published a Communication on “Digitalizing the Energy System – EU Action Plan”.
It has a section 6.4 on energy consumption of cryptocurrencies which notes correctly that proof of work uses more energy than proof of stake, the consensus mechanism the ETH (easy to hack) project recently moved to.
That of course means that all the security formerly achieved by a consensus mechanism that has been proven to work in over 10 years of Bitcoin running unbroken has been completely abandoned for a model that requires trusting stake holders. If you do that, why not use a normal database in the first place?
The Commission also notes that proof of work is “relatively outdated”. They seem to share the Greenpeace “Change the Code” dreams of moving Bitcoin away from proof of work.
The main outcome of this round of EU legislation was that those forces hostile to Bitcoin have been defeated for the time being. But there will be requirements to report and study the issue some more. The Commission announced here that they plan to develop a report by 2025 that assesses the environmental and climate impact of cryptocurrencies.
I welcome the idea that they should study the issue more. Their framing of proof of work as “relatively outdated” is not in line with basic principles of cryptography, where you want your systems to be hardened by many years of experience without suffering any case of it being hacked. Bitcoin is more attractive with each day it continues unbroken. Once it has its first thousand years of experience, it will be even more secure than today with only a little over ten years.
And of course there is also a challenge for Bitcoin supporters here. By at least late 2024 it should be clear to everyone that Bitcoin is a massive plus for the climate. Bitcoin mining will be not only carbon neutral, but the first major electricity use case to go carbon negative.
And Bitcoin itself will be a part of the solution by contributing to the robust accounting needed for a effective world wide answer to the climate crisis. You need to have robust accounting for carbon removal from the atmosphere to work at scale. And since Bitcoin already exists now, why not use it for this most important task of robust accounting tools? Why settle for anything less than the most secure accounting ever devised by the human mind?
Why trust the Easy To Hack ETH or some other such system with questions of existential importance for all of humanity when we already have proof of work and it has been proven to work for over a decade, while proof of stake ETH does not even have one year of experience under its belt?
Yes. Security costs some energy. But.
There is no free lunch. Of course you need to pay for security. And having a secure accounting system in place for all the accounting needed to deal with the climate crisis is well worth paying for.