Five industry experts who appeared before the US House of Representatives Subcommittee on Energy and Trade Oversight had differing views on how lawmakers should approach the issue of energy consumption through cryptocurrencies.
In an affidavit issued ahead of Thursday’s hearing on “Crypto Cleanup: The Energy Impact of Blockchain,” former cryptocurrency official Brian Brooks said that energy consumption in Bitcoin (BTC) mining was an “economic product” given the demand for other assets, including gold. . About the same amount of energy for mining, with “a number of other environmental considerations.” In addition, Brooks said that the traditional global banking system uses about 2.5 times as much energy to produce the same value as BTC at its current market value.
John Pelizer, founder and CEO of Soluna Computing and another witness who appeared at the session, said that from an energy point of view, the miners and computers needed to run cryptocurrency “do not waste” and can contribute to the development of renewable energy. The CEO said that, unlike other banking systems, bitcoin mining includes the ability to shut down systems when needed, giving miners the ability to suck excess energy from the electrical grid instead of recharging it.
Ari Jewels, a professor at Cornell University of Technology who often criticizes cryptocurrency mining in its current form, has endorsed the crypto space in general but advocated “energy-saving alternatives” rather than Proof of Work (PoW). ) involved in mining. He added that the transition of the Ethereum blockchain to Proof-of-Stake (PoS) is likely to require “much less energy” and will have features such as smart contracts and non-fungible tokens, unlike Bitcoin.
“Bitcoin is not like a blockchain,” Jewels said. “The huge promise of blockchain technology does not require Bitcoin or a power-intensive component called Proof of Work.”
Steve Wright, the recently retired former general manager of Chelan County, Washington, suggested that miners consider “mechanisms to provide incentives for crypto production to achieve effective results as soon as possible.” Wright noted that the region’s high cost of clean energy appears to be driving many crypto miners toward carbon-emitting fossil fuel energy sources “at least in the short term.”
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US lawmakers seem to be paying a lot of attention to cryptocurrency and blockchain as the space grows. In December, the Senate Banking Committee held a hearing on cryptocurrencies and how the United States could be in the race to adopt digital currencies. Brooks also testified at a House committee hearing that month on the role of digital assets in future finances.
“While digital tokens are a highly speculative and volatile asset class, they hold the promise of a more open and pervasive internet,” said Gregory Zerzan, a shareholder in law firm Jordan Ramis. “If politicians take a cautious approach and foster an innovative environment, the benefits to consumers, investors, and all Americans are likely to be huge.”