I’m really starting to get tired of having crypto-currencies constantly thrown in my face. These damn things are so complicated! Most of the people talking about them are just complaining about missing the investment of a lifetime. The worst-of-all though are those who keep insisting, “I called it”. Did you? I don’t see your bitcoins anywhere buddy. Anyways, I get it. They’re pretty amazing once you look into them. They’re also causing a very serious energy crisis right now but I’ll get to that.

Bitcoin was created by unknown genius Satoshi Nakamoto. It’s called a CRYPTO-currency because the process that includes the algorithm that enables the block-chain to keep consensus is secured by strong cryptography.

Those are a lot of complex words! To sum it up though, these currencies are not secured by people, or by trust, but by math. It is more probable that an asteroid falls on your house than a bitcoin address being compromised.

Learn more about crypto-currencies here.

Bitcoin was a fantastic investment a while ago. It’s currently a costly investment. It’s future definitely looks perilous. Why you ask? Well, a bunch of expert opinions like this one here.

And this one here:

And finally, because of articles like this one here. This article says that Bitcoin’s data mining network’s estimated power use exceeds that of 20 European countries, consuming more than five times the energy output of Europe’s largest wind farm. That’s completely unsustainable!

At those levels of electricity consumption, each individual bitcoin transaction uses almost 300KWh of electricity – enough to boil around 36,000 kettles full of water.

An important aspect of a peer-to-peer network value based crypto-currency is that it is a fast and global system. For Bitcoin, however, these transactions are slow, payment options are limited and energy consumption is through the roof.

The technology behind these crypto-currencies is inspiring for sure, and it is definitely fostering innovation in the financial-tech sector. There are going to be some massive strides taken towards more de-centralized forms of asset management.

However, alongside any form of innovation, we must ensure that sustainability is something we give great consideration to when assessing these future ideas and inventions.  I never thought Bitcoin would create such an energy vacuum, and now it has. We can’t repeat the same mistakes we’ve made in the past by making rash decisions and need to be careful moving forward.

Can you guys think of any new innovative ideas or businesses that are coming up which might cause something similar to Bitcoin? Do you guys have any suggestions as to how we could mitigate or control unforeseen externalities like that? Let me know!

• cryptocurrency
• financialtech
• sustainability