Pompliano told CNBC in an interview that Bitcoin’s energy usage continues to become more and more efficient as it scales and as miners tap into more renewable energy sources.
Pomp Investments founder and popular Bitcoin podcaster Anthony “Pomp” Pompliano says that the conversation around Bitcoin’s energy use and how efficient that is, largely suffers from “two key points” that people tend to miss.
During an interview, he said that. interview on CNBC’s “Squawk Box”, where he briefly highlighted the issues of Bitcoin’s volatility and energy use.
He told the shows’ host Joe Kernen that as people continue to debate Bitcoin’s energy consumption, they need to take note of the following:
Bitcoin scales up to become more energy-efficient
According to him, the first one is the “linear relationship between energy consumption and the US dollar system.” He goes on to explain why it is important for the conversation to take note of this point.
“In order to support more users and more transactions, we need to consume more energy. We need more data centers, more bank branches, more ATMs etc,” he added.
On the other hand, he explained, the Bitcoin blockchain doesn’t have the same kind of linear relationship seen between the fiat ecosystem and energy consumption. He said that no matter how many transactions are added during transaction processing, the energy consumed will be the same regardless.
“As it scales, Bitcoin becomes more and more efficient because you can pack more economic value into each of these blocks, whereas in a legacy system you need to consume more energy as you scale.”
“Important things in the world use energy”
Pomp also says that there’s nothing to apologise for when it comes to the issue of Bitcoin’s energy consumption. In his view, “important things in the world use energy”
He cites the increasing use of renewable energy for Bitcoin mining and says that this shift to greener energy sources is driving research in the renewable energy sector.
Before delving into the energy usage question on the show, Pompliano had first talked about one important metric- Bitcoin’s volatility.
The key point is that volatility is measured in dollars. If you think of the dollar itself, the dollar is hyper-volatile as well … 40% of all US dollars in circulation have been printed in the last 18-24 months.” Says @APompliano. “One #bitcoinOne bitcoin is still the same as one bitcoin. pic.twitter.com/O5CwpEwGkB
— Squawk Box (@SquawkCNBC) December 27, 2021
He said that BTC had experienced two major price declines of over 50% in 2020, as well as six corrections exceeding 20% this year. Although there have been some price spikes, he believes the best way of looking at volatility is to consider the US Dollar in which Bitcoin price movement occurs.
If you think of it this way, he explains, you will find that indeed USD is also “hypervolatile.”