Bitcoins and Rai stones

Rai stones were carved circular stones Micronesian people's used as currency. The stones were too big to move. Transactions involved oral agreements on who currently owned the stone. The history behind a stone set its value. If people happened to die during the construction of the stone, it's value would increase.

I used to think it was the weirdest form of currency ever -until I took a really good look at Bitcoin.

At first there were a number of things that attracted me to Bitcoin. It's a currency free from government sponsorship. Unlike a fiat currency, it's value was established outside of governmental control. It's value could not be inflated away at the whim of a politician. In that respect is was like precious metals. Gold has value all over the world. The catch may be getting it across International borders.

That's one area where Bitcoin shines. By memorizing a simple numerical code, your Bitcoins could be accessed from anywhere in the world with an Internet connection. While that feature is attractive to freedom loving people, it has proven to be a boon mostly to criminals.

I could live with that. After all, there are plenty of laws against criminal activity. The thing that really flipped me out is the discovery that Bitcoin “mining” uses more electricity than the whole country of Denmark. That's insane. Bitcoin gets its value from wasting electricity and computer power. We might as well go back to Rai stones.

Mining gold and silver can be hard on the environment. The quest for precious metals has caused much grief around the world. Wars have been fought, cultures and people's destroyed. However, there are some real uses for gold and silver, especially in modern electronics. Heck, if nothing else you could form a gold bar into a frying pan and cook an egg. Try that with a Bitcoin.

Electricity to run Bitcoin mining computers has to come from somewhere. Fossil fuel plants create pollution, nuclear plats have nuclear waste products, even windmills and solar panels have to be constructed so resources are used. The thought that some destructive power project may be going forward due to increased power demands from Bitcoin drives me nuts. What a waste of energy.

While I'm a strong believer that the human race has to change the way money works, Bitcoin isn't the answer. Just as an aside, I believe Bitcoin is in a huge bubble right now. It would not surprise me if its value would suddenly drop 90% or more. Just a heads up from some dude living out in the woods.

-Sixbears