Crypto’s great reckoning
This space is starting to feel like it’s an Elon Musk gossip blog.
He’s almost all we talk about. I dream of what Musk might Tweet the next day and how that might make or lose millions of dollars for investors around the world.
That latter point is why we can’t ignore him, even when it feels like we’ve reached a breaking point. The man is important and every utterance he makes literally moves the market.
So, talk about him we do.
And, we need to talk about him again today. Earlier today (Tuesday) Musk weighed back into the crypto space to once again cause ripples.
Sitting at $36,591.16 USD at 7am ET Tuesday, Bitcoin has steadily climbed throughout the day to be at $37,855 at 2pm ET, the time of writing. Other coins followed suit. Ethereum went from $2,397.09 to $2,584.84 and XTC went from 0.8882 to 0.9420, for example.
After a week of near constant dip, it was a welcome respite for crypto bulls. Will that last? Who knows.
Regardless of which way the movement went, the biggest story here is that every time Musk speaks lately it seems like the crypto market does something. So, in some ways, it doesn’t matter what exactly he says in any given utterance. However, you might want to pay a bit more attention to today’s topic.
What Musk Tweeted was this: “Spoke with North American Bitcoin miners. They committed to publish current & planned renewable usage & to ask miners (worldwide) to do so. Potentially promising.”
I can almost hear some of you audibly signing from here when the environmental concerns with coin mining are brought up. Yeah, Bitcoin mining uses a lot of electricity, but so do a lot of things. Is the real energy cost of Bitcoin greater than the overall benefits?
That’s something that is still to be determined, but a lot of smart people will tell you that the description of crypto mining as an “environmental disaster” is widely overstated.
The thing is that the conversation about the environmental impact of crypto mining is that it’s not really about logic and data and facts. Rather, it’s about emotion. Where you come down on the debate of the risk largely depends on your feelings about environmental issues in general.
If you, like Musk, believe that Climate Change is the biggest issue facing the world today then you’re not likely to care about intellectual discussions about cost-risk benefits when it comes to the practice. You just want it to be cleaner and, if that doesn’t happen, you’re not interested.
Perception is reality, right?
Musk (and many others) perceive that there is a problem here. So, if you want crypto to reach mainstream acceptance you’re going to need to face this concern head on and in a way that satisfies those with these concerns.
Just dismissing the environmental pushback may make you feel better – and you may even be right to do so – but its ultimately counterproductive.
It’s just one additionally part to the maturation of the crypto space. And, like any maturing, it’s never going to be smooth or a happen in a straight line.
And, who knows? Maybe one day it will get to the point where it no longer is so reactive to the Tweets of one man, like Musk.