According to US politicians, PoS consensus is better than PoW because it is less polluting.
The Mining Council proves that politicians’ calculations and arguments are based on prejudice.
The Bitcoin Mining Council (BMC) refuted the arguments that several United States (USA) politicians made against the activity. As explained by the consortium of companies that support the industry, education is needed among congressmen who criticize mining, to understand that such action is not as polluting the environment as compared to other companies.
In a letter published on the afternoon of Monday, May 2, the Council, made up of Michael Saylor, Mike Novogratz, Jack Dorsey and other leaders of the Bitcoin (BTC) ecosystem, refutes the missive that 23 US congressmen sent to the Environmental Protection Agency (EPA) on April 20, asking for more regulation of the industry.
In the document, the politicians stated that Bitcoin mining is polluting, that it poisons the water of the communities and that it represents a danger to the environment. For BMC representatives, such claims are “misperceptions” that, in the past, have already been discredited by the industry.
As a reaction, the BMC responded to several key points in the politicians’ letterthrough a letter that was also addressed to the EPA, more precisely to Michael S. Ryan, who is the administrator of said government-environmental office.
They confuse a Bitcoin mining farm with power generation plants
In the letter, the politicians claim that Bitcoin mining farms are “polluting communities” and contributing to greenhouse gases. For the BMC, congressmen are confusing data centers with power plantswhere, in reality, the contamination occurs.
The BMC clarifies that data centers (data center) to mine Bitcoin do not have great differences with those used by Amazon, Microsoft, Apple, Google or Meta; and that, in any case, miners operate by buying energy from a generating plantas do the companies mentioned.
They also maintain that mining farms do not emit carbon dioxide (CO2) or any other pollutants, beyond the heat generated by the machines, which is dissipated and controlled with ventilation systems. They compare this with other industries, which, they affirm, are polluters of the environment.
Instead, they argue that most miners use renewable energy for their operations. According to a study by the Bitcoin Mining Council itself, the industry as a whole uses approximately 58.4% sustainable energy, moving away from fossil fuel sources of electricity generation.
In any case, and according to the BMC, the pollution that politicians talk about responds to the function of electricity generationwhose affectation is “a consequence of the politics and economic reality” of the United States.
According to politicians, Bitcoin mining farms “poison” the waters of American communities, due to their alleged contamination.
For the BMC, this is, again, a confusion of farm and power plant. For this, They call to use the existing regulatory frameworks in that country to “challenge and regulate electrical installations”.
“It is unfair to look at power plants that are connected to mining farms and run less than 2% of the Bitcoin network and attribute the pollution to the entire industry,” they criticize.
“PoW mining generates polluting electronic scrap”
Another point rejected by the BMC was that Proof-of-Work (PoW) mining is a generator of supposed electronic scrap that pollutes the environment.
According to the Council, for this, the politicians used an article signed by the banker Alex de Vries, who has already criticized PoW mining in the past, as reported by CriptoNoticias.
Said article stipulates that a Bitcoin mining ASIC is discarded every 1.3 years and that many of those remains are piled up in a certain place. For the BMC, “this is purely an academic proposal”, since there is no evidence whatsoever about junkyards with obsolete ASICs.
To go deeper, they cited the example of the Bitmain miner, the Antminer S9 (13 TH/s), a team with almost 6 years in the market and that, although it is no longer as economically productive, still accounts for 40% of the global Bitcoin hashrate.
The Council maintains that old units like this are resold and not destroyed. They also explain that ASICs are almost entirely recyclable devices, because they do not contain toxic or difficult to recycle components“unlike conventional sources of electronic scrap, such as cell phones, which have lithium batteries,” a highly polluting chemical component.
The Bitcoin e-waste claim is not based on evidence of large numbers of miners in junkyards. These simply do not exist. It is a chimera derived from an idle academic fantasy that failed to incorporate any relevant data from the industry. We challenge members of Congress to identify any major sites where Bitcoin e-waste has accumulated in large amounts. They just don’t exist.
Bitcoin Mining Council.
They say that a transaction in Bitcoin could power a house
Another point they refute has to do with the fact that, according to the twenty congressmen, a transaction executed on the Bitcoin network consumes the energy that could power an American home for a whole month.
For the Council, “this is patently and demonstrably false”, since a transaction made in Bitcoin does not require more energy than a message sent on the social network Twitter or a search on Google. They remember that the issuance of Bitcoin as a result of mining is decreasing, knowing that 90% of the total coin supply was already mined.
They also mentioned Bitcoin’s micropayment layer, the Lightning Network, which “mirrors exactly how established payment systems work.”
“Bitcoin processes a similar number of annual transactions to the Fedwire settlement system, which settles a value of trillions of dollars daily,” they say from the Council, to then clarify that, even if the number of payments in Bitcoin increases, that does not necessarily imply a proportional increase in energy consumption.
It makes no sense to associate energy consumption with individual transactions, as Bitcoin energy use is not related to transactions. Bitcoin can scale without increasing energy usage.
Bitcoin Mining Council.
“PoS is better than PoW”
According to politicians, the Proof-of-Stake (PoS) consensus is superior to PoW because it “consumes less power.” Furthermore, they qualify it as a “cryptocurrency mining technology”.
For the Council, this is unfeasible. They clarify that PoS is not a technology, but rather a “technique for determining authority over a distributed blockchain, but without achieving decentralized distribution».
They explain from the BMC that the consensus mechanism PoS has a limited history and is controlled by the founders of some particular association, in addition to the fact that it has points of failure “and it remains doubtful whether PoS can effectively govern a global and apolitical monetary system”, as PoW has shown, according to the consortium.
They argue that PoW is free-market competition and thus “miners’ economic margins tend to be meager in equilibrium, meaning that no one entity has a disproportionate and lasting advantage when it comes to creating new currency units.”
Proof of Stake [PoS] should be understood as a technical industry term for a financial consortium controlled by shareholders. It transforms financial systems into pure plutocracies, an outcome incompatible with tools intended to be decentralized, global, and completely free of political barriers.
Bitcoin Mining Council.
Now that the United States Environmental Protection Agency has both views of the Bitcoin mining industry, it will be necessary to see if the state centralization follows the arguments of the politicians or studies the case in depth, using as a reference the clarifications of the Bitcoin Mining Council. The ball – now – is in the court of the US government.