🅱️ WHY MINING? Just Print More Bitcoins...
When I first learned about Bitcoin and Cryptocurrencies, one of the main concerns was centered around mining.
People were really afraid because of the energy consumption. Some people were worried that mining would be the end of the world because of global warning and all those things. Real worries I should say.
Some years later a volcano blew up sending trillions of tons of CO2 into the atmosphere. The thing went on for months, the sky turned black and many people went through a really hard time... Nobody cared about global warning at this point.
The good news is that the volcano gave us a lesson: Bitcoin mining doesn't matter because, if we can survive the trillions of tons of CO2 emitted by volcanos every single day, then we can survive the negligent amount of energy consumed to produce Bitcoin... But why is this a problem in the first place?
I shall explain.
Bitcoin is a solution.
Bitcoin is the solution to a problem.
The intention in the creation of Bitcoin was to create a type of money that is deflationary.
Without going too deep into economics, let's just say that a large portion of the global population is no longer happy with fiat currencies and CBDCs because they are inflationary currencies. Meaning that their supply can always be inflated and thus the value of the currency tends to decrease over time. This decrease in the value of the currency as its supply increases results in an increase in the price of the things we buy on a daily basis, which we call inflation; we all hate it.
The solution is Bitcoin.
Now, FIAT money is inflationary because it requires no energy to produce, no effort, it can be created out of thin air so in a way, it has no real value. It only has the value we give it and give it value and that's great. This value comes by decree.
Bitcoin requires energy to produce on purpose.
Bitcoin requires capital to be minted on purpose.
In this way, any and every single Bitcoin that is created has real value; and this value is the energy, money, effort —mining— that was put into producing this good.
Since it takes time, money and energy to produce this good, it cannot lose value easily. It cannot be easily inflated.
At the same time, we have this feature on the system called the halving, which reduces the amount of Bitcoins that are created every 10 minutes. So each time you have less Bitcoins being produced but it still requires energy to be produced and thus its price tends to increase rather than drop.
Since we have less Bitcoins...
Since it has a fixed supply...
The currency is programmed to maintain its value overtime or even rise.
The highly energy consumption process needed to create Bitcoin is not a problem but rather a feature in order to protect Bitcoin's value. It is a fail safe mechanism so that no individual player or participant can increase the currency supply, and thus decrease its price, when they have bills to pay.
Make it worth something, in this case energy/electricity and thus money, and since it has real value, it can never be created out of thin air.
In order to create Bitcoin you need energy.
Bitcoin is virtual energy.
Bitcoin is physical and spiritual (electricity) energy that is now available for us to transfer instantly through the Internet.
Bitcoin is the present of money.
Bitcoin is here to stay.
I will do a better job at trying to explain myself next time but I hope you understand.
Do you agree?
Are you holding Bitcoin now?
Thank you for reading.
Namaste.