The mayor of Vancouver wants to make the Canadian city bitcoin-friendly, but the idea leaves a lot to be desired.
What's happening?
Ken Sim, a fanatic for the cryptocurrency, proposed the motion earlier this month, Canada's National Observer (CNO) reported. City councilors approved it, "giving staff the thumbs up to explore holding cryptocurrency in reserve and accepting payments in the virtual currency," according to the Canadian Broadcasting Corporation. Sim also said he'd donate $10,000 in bitcoin to the city.
The plan touts the green benefits of bitcoin, but some experts and critics point out how energy-hungry it is. Bitcoin regularly uses huge data centers and powerful computers in its operations. Almost 50% of the power for bitcoin mining comes from burning coal, and about 20% comes from burning natural gas, according to CNO, based on a United Nations study. Another 16% is powered by hydroelectricity, but solar and wind energy met only "a tiny fraction of the demand."
The CBC noted that bitcoin, which recently hit a record high, is volatile and that existing laws don't allow cities to use bitcoin. City Councilor Pete Fry said the proposal was worrisome because of the city's history of organized crime and corruption.
Why is this important?
"Cryptocurrencies like Bitcoin are infamous for having substantial impacts on climate, water and land, primarily linked to the massive amounts of electricity needed to 'mine' the currency," the CNO article stated. "This is a process when computers scattered around the world verify transactions made with the currency."
This situation also highlights how those in power can bend the will of the people to their liking, as the CNO article highlighted. While Sim doesn't seem to be hiding anything, this proposal and a similar one to undo a natural gas ban in new buildings — supposedly because the city lacks the capacity to heat them — appear disingenuous at best.
In British Columbia, crypto mining has been banned because the province may not have enough power, CNO reported. That energy could be used for more widely beneficial endeavors, as bitcoin can disproportionately impact poor and underrepresented communities while helping the rich get richer.
"[It] just does not make any kind of sense," City Councilor Adriane Carr said in the CNO article.
What's being done about bitcoin mining?
If bitcoin's surging value and the microscope on it and other cryptocurrencies' energy usage drive the technology to become greener and help in the development of clean, renewable energy sources, the backlash around Sim and other advocates may turn into a success story.
There's another narrative about the good of the industry these days too: that it can reduce wasted energy by powering mining operations with unused electricity from the grid. But until mining does not rely on dirty energy or contribute what some countries do to the warming of the planet, it will be targeted by climate activists, environmentalists, and even citizens.
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