critique:  Bitcoin's mining process is extremely energy intensive, and therefore wasteful

rebuttal:  Bitcoin's energy spend is required to do three things: fairly distribute new bitcoin according to bitcoin's monetary policy, allow anyone to participate in the bitcoin network on even footing, and create the strong security assurances around bitcoin's transaction settlement. Any financial system will have certain properties and guarantees, and they never come for free.

Before digging in further, some context is helpful here. Some back of the napkin math suggests that as of this writing (Feb 2021), bitcoin uses less energy than clothes dryers just in the US, and also less energy than just US households spend on "vampire energy draw"; ie, devices like TVs and cell phone chargers that are plugged in, but turned-off and not doing anything. This is to say, bitcoin's energy use happens to be very easy to calculate, but pales in comparison to much more mundane sources of power consumption that most people don't think about much.

But even with the scale more properly contextualized, it would still be a shame if bitcoin wastes energy. So does it? Financial systems require infrastructure and security one way or another. In the case of gold, enormous amounts of effort and energy are spent to both mine it and securely store it. For modern government currencies, the physical banking infrastructure, and human capital to make it all work and settle correctly is extremely costly. These costs are usually not directly measured in energy, but it could be expressed that way in theory, and they'd be very large numbers.

With bitcoin, the creation of the asset, as well the processing of transactions, and the assurances around bitcoin's security are all bundled into the mining process which deliberately expends energy. The energy is spent as a "proof of work," the sum of which assures that bitcoin's transaction ledger cannot be changed. This is essential for bitcoin's monetary policy certainty, as well as other key properties. With hundreds of billions of dollars in market cap and billions of dollars settled on the bitcoin network every day, there is clearly significant demand for the services bitcoin provides, and bitcoin mining expends energy to support those services. This energy spend is not wasted; the market explicitly demands it.

Additionally, bitcoin mining has strong reliance on renewable energy, and furthermore, the hyper competitive and global nature of bitcoin mining suggests that it may eventually rely almost completely on renewables, since they are likely to be one of the cheapest power sources long-term. Jack Dorsey, CEO of Square, recently noted:

“We believe that cryptocurrency will eventually be powered completely by clean power, eliminating its carbon footprint and driving adoption of renewables globally... Published estimates indicate bitcoin already consumes a significant amount of clean energy, and we hope that Square’s investment initiative will accelerate this conversion to renewable energy.”