The story is set in 2021. Gates has steadfastly resisted bticoin, and recently said that he’s worried that bitcoin uses more electricity per transaction than any other method known to mankind. The truth is that Gates has been bearish on bitcoin for some time now. Three years ago, during an “ask me anything” session on Reddit, Gates said that cryptocurrency has been responsible for various evils, including buying Fentanyl and other drugs, money laundering, tax evasion and terrorist funding. In 2018, Gates said that he would short bitcoin if there were an easy way to do it. A 31-year-old Gates became the youngest billionaire in the world in 1987, shortly after Microsoft went public. In 1995, at age 39, he was the richest man in the world with a fortune of $12.9 billion and held the title on and off for decades. But there’s a simple reason Gates is no longer the richest person alive, and it’s not because of Tesla’s or Amazon’s tremendous growth. Bill and the Gates Foundation made a mistake when they chose not to embrace bitcoin. While Bill Gates is an extremely smart man, he does not understand bitcoin and decentralization. Microsoft’s ex-chief built a company that’s the epitome of a centralized organization. But there is so much that he could do for the world, if he embraced in bitcoin and the decentralized values it stands for. He could strengthen the global community’s philanthropic impact by facilitating a faster, affordable, and more secure process for moving funds all around the world. He could ensure financial inclusion for everyone.
Ilias Louis Hatzis is the founder and CEO at Kryptonio, a decentralized and keyless crypto wallet. Kryptonio eliminates all the shortcomings of centralized crypto exchanges and problems with managing private keys and seed phrases. Sign up and be the first to get the safest cryptocurrency wallet.
Starting on Saturday morning, the world’s top cryptocurrency crossed $60,000 mark for the first time and hours later it shot past $61,000 to set a new all-time high of $61,124.86.The new high came two days after President Biden signed the $1.9 trillion stimulus package that will be sending checks for $1,400 to US citizens. People have started receiving the checks, which could be another factor in bitcoin’s rise.
Recently, Gates argued that the practice of bitcoin mining was exacerbating the effects of climate change. The process of bitcoin mining, verifying transactions using powerful computers to solve ultra-complex mathematical equations, consumes a huge amount of electricity.
If you compare bitcoin’s power consumption to that of the banking system, then you’ll see that the consumption of banks is 3x larger than bitcoin’s. In another example, VISA requires 149 kWh of energy to perform 100,000 transactions on its global settlement network. The Lightning Network is over 1 million times more energy-efficient than this outdated network.
Now, can bitcoin become more every efficient?
Sure, it can. The bitcoin network could agree to use PoS algorithm (proof of stake), like Ethereum. Some believe that eventually bitcoin will also move to PoS, reducing its electricity consumption. But the problem with PoS is that under this algorithm, staking wallets with more holdings have more votes. This means that a small group of wealthy stakers can control the entire network, voting on changes that benefit them. For example, a large entity or wealthy group, like a central bank, could use fiat money to purchase vast amount of a PoS coin, hold them until their wallets become eligible for staking, and then take over the network. Sounds pretty centralized to me.
Regardless of the media coverage on bitcoin’s energy consumption, the reality is that bitcoin is a huge driver for renewable energy. Research by Coinshares shows that 74% of bitcoin mining uses electricity from renewable sources. According to another study by the Cambridge Centre for Alternative Finance (CCAF), the use of renewable energy in cryptocurrency mining is being driven by hydroelectricity. The CCAF research showed that 76% of miners use renewable energy to power their activities, with hydropower the number one source at 62%. Wind and solar energy meanwhile are used by 17% and 15% respectively.
Bill Gates has bet against bitcoin, every step of the way. Despite being a famous technology CEO, Bill Gates is a conservative investor who has done very little in the tech startup world. His top holdings are Berkshire Hathaway, Waste Management, Canadian National Railway Company, Caterpillar and Walmart.
Bitcoin is supported by some of the brightest minds in technology. The most successful technology investors believe bitcoin is a viable form of currency. Venture capital firms such as Khosla Ventures, Union Square Ventures, Lightspeed, and a16z have been funding bitcoin projects for several years. In an editorial in 2014, Marc Andreessen talked about the divide between how technologists feel about bitcoin and how the rest of the world sees bitcoin. He argued that the ongoing movement by researchers and developers to bring this technology to the market will eventually win out over the public’s unwarranted bias. Over the last decade, Bitcoin has continued to prove that it’s one of the most important technologies and will continue its upward path, regardless of Bill Gates and other detractors.
One of bitcoin’s hurdles is multigenerational adoption. But perhaps this is not really a problem, when you consider millennials. Bitcoin and cryptocurrencies have been in existence for most of the adult life of millennials. When this generation grows by another decade, crypto and crypto wallets will be frictionless. Edelman Research published a study of 1,000 millennials with over $100,000 in income and found 25% own cryptocurrency.
In an interview, Bill Gates once said: “The secret of my success is that I do not miss any opportunities like you just did.” Well, from where I stand, it looks like Bill is missing the opportunity presented by crypto.
The applications that bitcoin and cryptocurrency can have when it comes to helping those in poverty are massive. Digital could lower transaction costs and provide universal access to innovative financial products. Two billion people are unbanked and trapped without access to bank account or financial tools that can help capitalize on their assets (intellect and labor) and lift them out of poverty.
What a remarkable opportunity crypto presents to help on a massive scale.
Just like Disney saved Mr Banks, bitcoin could save Mr. Gates.
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