Will Bitcoin Help the Energy Revolution?

By Ben

I have spent most of my adult life organizing campaigns, trying to make change for the better in regards to climate change. I am now getting pretty excited about a new technology that has the potential to be extremely disruptive, in a good way. No, it’s not a more efficient battery, electric car or solar cell (that’s cool too but…) I’m excited about what is often called “crypto-currencies” like Bitcoin. What is the connection?

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One of the reasons Bitcoin is so appealing to me is that it’s a mechanism that distributes power and control and takes it away from the big banks. Wikipedia explains cryptocurrency like this: “…a medium of exchange using cryptography to secure the transactions and to control the creation of new units…Cryptocurrencies typically feature decentralized control (as opposed to a centralized electronic money system) and a public ledger (such as Bitcoin’s block chain) which records transactions.” This seems like a great companion for the decentralized energy revolution we need to stop a climate crisis.

As a climate campaigner I am concerned about the implications of the power of the big banks. If we are to take seriously the urgent need for change and we are aware of the availability of viable energy alternatives it’s sometimes hard to understand why the age of fossil fuels has not come to an end already. The obvious answer of course is that fossil fuels have been amazingly profitable over the last century and the big banks are addicted to those profits and keep investing more and more which is what makes these mega projects possible.

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Some would argue that the alternatives, like wind and solar energy, are simply not cost competitive and their share of the energy mix is just economic forces at work. The truth is that government subsidies, tax loopholes and favourable regulations along with vastly disproportionate investment from the banks has clearly stacked the deck against alternative energy companies for decades. Despite this, alternative energy sources are now cost competitive with fossil fuel derived energy today in many jurisdictions. In some cases alternatives are actually cheaper than fossil fuels already and the trend lines are moving exponentially in that direction globally. Yet still there is a lot of money to be made off fossil fuels and regardless of the implications the banks continue to lead us down this dangerous path.

What’s even worse is that investors like the infamous Koch brothers are coordinating campaigns to try to block solar and wind projects. Why are they doing this? There is a big difference between decentralized system of solar panels on everyone’s roofs that they don’t own or control and the big power plants that they do own and control. Decentralized energy production is a big threat to Big Oil’s profits and their influence just like decentralized money is a threat to big banks in the same ways. The unchecked power of these institutions can undermine everything from democratic processes to fair markets.

We were reminded of the how unaccountable the banks often are compared to the rest of us when over the holidays Charlie Shrem, a prominent Bitcoin entrepreneur who ran a currency exchange, was sentenced to two years in prison. By comparison Wall Street executives never seem to get jail time no matter how many people’s lives are adversely affected by their actions. Shrem pled guilty to his role supporting the now infamous Silk Road, which sold drugs over the Internet. Although Shrem demonstrated significant contrition for his crime and forfeited almost a million dollars, the judge stated clearly he wanted to make an example of Shrem and gave him prison time.

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Meanwhile the British banking giant HSBC, was only fined for their role in assisting Mexican drug cartels launder money in 2012 and there were no criminal charges. Then, in 2013, they were again only fined when they were found to be transferring funds on behalf of Hezbollah, a Lebanese Islamist militant group widely believed to be associated with terrorism.
Money laundering is a problem regardless of what currency is being used. So how is it that a Bitcoin executive would get such a disproportionate outcome from the justice system? It seems clear that the big banks are simply too powerful. We all remember the assertion that the banks were “too big to fail” during the financial collapse in 2008. It seems the same logic applies in the justice system: too big to jail. If money is power then banks are the most powerful institutions in our society. This power puts the banks in a special position seemingly above the law. They impact public policy decisions directly and indirectly and make investment choices which shape our world. Keeping that power in check seems fundamentally important if we are ever going to make the kinds of change required to address the climate crisis.

The transition off of fossil fuels and away from the control of the big banks won’t happen overnight. I feel strongly that people working on energy alternatives and alternative currencies have common cause. Of course cryptocurrencies could also be spent on oil pipelines or coal mines but I am hopeful that many Bitcoin supporters share my desire for a better world.

On a personal level I have recently been crowdfunding for a book I’m writing that seeks to be a road map for moving beyond fossil fuels based on my experiences as a campaigner. I’m excited to not only be writing about the role of cryptocurrencies but to be able to accept Bitcoin for pre-orders and donations. If you want a copy of the book or you want to simply support the project my Bitcoin wallet address is 1CGDZaK1EiBqT8NfqxLMRQe6Rc27gQs1SH.

It’s very cool how the crowdfunding platform I’m using (Dana.io) has encouraged and supported the use of Bitcoin. I am also launching a Beyond Fossil Fuels (BFF) campaign for the new year with Tanker Free BC the NGO I have just been hired to direct and one of my first actions was to set up a bitcoin wallet (1Er18hpVyZUy6RZ2MXN53gWH1KQeYN9vJ). We are asking for Bitcoin donations to help fund awareness raising, policy advocacy and getting alternative energy projects off the ground in Western Canada. We want to demonstrate the viability of the alternatives in the midst of an epic fight against new tar sands pipelines. We want to help people understand and experience for themselves that there is a better way. I hope we can help spread awareness and adoption of Bitcoin at the same time.

Speaking of which, if you are reading this and you want to give Bitcoin a try here is a good place to start: visit https://blockchain.info/wallet/new and create a wallet. You can then buy Bitcoins a few different way. In Canada check out your options here: http://www.buyingbitcoin.ca/exchanges/.

I’m particularly intrigued by the potential of a very new cryptocurrency, SolarCoin. I just set up a SolarCoin wallet (8WiAWvihWK9jKmFEgiVPdWYB3APDMBmcRx) over the holidays after spending some time reading the very interesting “DeKo” proposals. The idea behind solar power backed money laid out in the proposal makes a lot of sense to me. This really gets to the core of the question of what our money really is and what gives it value. It’s very cool to have a chance to see how we can make the energy and monetary systems support each other in such a positive way.

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Venture capitalist Ben Horowitz said recently, “money is too weak a metaphor for Bitcoin… just like when people first thought of the Internet, like, ‘oh, it’s the electronic post office’ — well, it’s not just the post office, right? The metaphor is too weak. Bitcoin, like alternative energy sources, has the potential to be disruptive in more ways than we can even imagine right now and could lead to innovation and opportunities we have not even yet considered. In short, distributing power is a good thing for everyone. 

To those of you reading this who are using Bitcoin already, I hope you might be willing to show your support by donating Bitcoin, SolarCoin or some of your valuable time to my work or to other progressive organizations working for change that are recognizing the value of cryptocurrencies. We have big challenges ahead of us but that is also an exciting opportunity. I can’t imagine anyone more prepared to face these challenges than the passionate visionaries who can see a new world emerging. Real change has always come from people like this working together inside social movement for common goals and against common foes. We are stronger together.

Ben West – Executive Director

Tanker Free BC

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