Michael Saylor defends Bitcoin and Proof of Work

Michael Saylor, the former CEO of MicroStrategy and a founding member of the bitcoin lobby group Bitcoin Mining Council, published a letter setting out his views on the environmental concerns surrounding bitcoin. Unsurprisingly, he considers the recent debates surrounding the energy intensity of Bitcoin mining inflated. In fact, in his view, the recurring discussion is part of the lobbying efforts of competing proof-of-stake crypto projects.

Proof-of-Work-Verbot

Saylor’s letter came just days after a US government report was released. In this, the climate impact of the crypto industry was examined. The authors of the report also considered a ban on the proof-of-work consensus mechanism used by Bitcoin due to the high energy intensity. Saylor clearly disagrees.

For him, Bitcoin’s contribution to climate change when viewed globally is nothing more than a “rounding error”. As much as “99.92 percent of global CO₂ emissions” are due to use for industry and purposes other than bitcoin mining, he explains. Bitcoin is “neither the problem nor the solution to reducing emissions”.

A study by the Bitcoin Mining Council mentioned above could prove him right. This states that almost 60 percent of the energy sources for Bitcoin mining are said to come from renewable energies. Saylor even believes that proof-of-work mining of the digital currency could bring environmental benefits. For example, when mining at locations of “stranded” energy sources, such as methane gas.

“Proof-of-Stake-Lobby”

His criticism of Proof-of-Stake advocates came just hours before the Ethereum Merge, the conversion of the consensus mechanism of the second-largest blockchain in the crypto sector from Proof-of-Work to Proof-of-Stake. In some places, the letter can therefore also be read as a clamp to the blockchain, which is currently in second place.

The developers and community around Ethereum had emphasized the drastically reduced energy consumption after the changeover in the past few months. Saylor regards such passive references to the energy intensity of bitcoin mining as “guerrilla marketing.” For him, an attempt by “crypto promoters and lobbyists to divert the attention of politicians, regulators, and the public from the uncomfortable truth that proof-of-stake crypto assets are simply unregistered securities.”

Michael Saylor, as a self-confessed Bitcoin maximalist, has often railed against Ethereum. In his opinion, the project should be viewed as a security due to a lack of decentralization and must be regulated accordingly. However, other maximalists, such as Bitcoin influencer PlanB, known for his (sometimes disproved) stock-to-flow model, were also skeptical about the new Ethereum image.