Representations of bitcoin and US dollar banknotes. bitcoin is digital money, similar to any other currency, though more transferable and outside of the control of banking systems and governments. Reuters
Representations of bitcoin and US dollar banknotes. bitcoin is digital money, similar to any other currency, though more transferable and outside of the control of banking systems and governments. Reuters
Representations of bitcoin and US dollar banknotes. bitcoin is digital money, similar to any other currency, though more transferable and outside of the control of banking systems and governments. Reu
Miles of ink have already flown in commentary and analysis about the cryptocurrency bitcoin. But recently, something has changed – and it may be ominous. As trading volumes have shot up, the digital currency is being weaponised to support all different kinds of interests. Where will this lead?
Consider bitcoin's beginnings. It is digital money, similar to any other currency, though more transferable and outside of the control of banking systems and governments. For this reason, in the early days, it was used extensively for illicit trade and transactions. Then some uber-cool coffee shops and retailers also accepted BTC, when this elusive currency could be had for less than $2,000.
From there, the fascination spread, and cryptocurrencies were flogged in places from low-cost airline in-flight magazines to personal finance blogs. More money piled in causing a massive rally and valuing the currency at close to $20,000 in December 2017 before registering big losses. And onto the rollercoaster we climbed. But what will the future history read?
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Economists such as Nouriel Roubini caution individuals strongly against investing because there is no underlying commodity, business or asset that provides BTC its value. Warren Buffet, veteran investor, shares this view and concern that the price increase is pure speculation.
But it may be risky in another much larger way, too.
Since this currency is entirely digital and is transacted in complex ways, it is extremely energy intensive – thousands of times more so than credit card transactions.
Iran has blamed the energy demand of hundreds of cryptocurrency transaction centres in the country for recent power outages in Tehran. The clever folks at the Bitcoin Electricity Consumption Index, an effort of Cambridge University, have put a number to it: bitcoin's annual energy consumption is 129 Terawatt hours, which is more energy than the Ukraine consumes in one year – a population of 44 million with a GDP of $153 billion. The current total value of BTC is now well over $1.5 trillion – without having produced anything at all – not one toaster, not one graduate, not one beach towel on a Black Sea resort, nothing that even remotely resembles an output of a country.
Yet, the energy consumption and carbon emissions of this phenomenon are symptomatic of our aversion to include the true cost of carbon while apparently creating wealth out of thin air.
Still, plenty of people and companies point to BTC continuing to grow in value and the need to invest further. Somewhat ironically, electric car company Tesla is one of them. Another is Dambisa Moyo, a development economist, who recently advocated for bitcoin to be a store of value. She argues that companies must invest in this currency as a measure of self-protection, a kind of insurance. Companies that invest successfully will be able to take over poorer companies that have not invested.
Tesla chief executive Elon Musk. Tesla is one of many companies intent on investing in bitcoin. AFP
With this argument Ms Moyo has “weaponised” bitcoin and created a cryptocurrency arms race. This is akin to a cold war: nobody wants it but, equally, nobody can afford not to participate. It is a stratospheric war at that, fought at high altitude at such high stakes that the effects will splash down over the population. Savings, pensions and debt are rolled into the exposure to bitcoin as institutional investors join in.
This means massive volatility – on March 14 it was worth $61,600 and down to $54,000 two days later. In November 2017 its value was $327. But what if institutional investors held on for several years? What if the value collapsed? What if everyone was invested in the currency – even schoolchildren could invest their lunch money in this global de-centralised digital honeypot. Could bitcoin become too big to fail? Will governments need to bail out those who sustain losses?
Illuminated mining rigs at the CryptoUniverse cryptocurrency mining farm in Nadvoitsy, Russia. The rise of bitcoin and other cryptocurrencies has prompted a push among central banks to develop their own digital currencies. Bloomberg
The digital experiment is of epic and real-life proportions: over $1.5tn are locked into this code. Much of that money could have gone to re-kindling Covid-19-ravaged economies (just watch those stimulus cheques going to bitcoin). Everyone is hoping to strike it rich, everyone else fears missing out. Few worry about the planetary climate implications and more trading means more carbon emissions. Others egg on investors by weaponising BTC. Energy allocation is prioritised to carry out transactions over essential services.
How might it unfurl as wealth is created and destroyed so easily and ethereally? This sounds like a dystopian future and addictive game rolled into one. But, of course, this is just one possible scenario. I’m sure there is another one somewhere, in which everyone gets rich, someone somewhere resolves the climate and energy issues, and we all live happily ever after.
Dr Patrick Noack is the executive director of future, foresight and imagination at the Dubai Future Foundation
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Nils El Accad, chief executive and owner of Organic Foods and Café, says going green is about “lifestyle and attitude” rather than a “money change”; people need to plan ahead to fill water bottles in advance and take their own bags to the supermarket, he says.
“People always want someone else to do the work; it doesn’t work like that,” he adds. “The first step: you have to consciously make that decision and change.”
When he gets a takeaway, says Mr El Accad, he takes his own glass jars instead of accepting disposable aluminium containers, paper napkins and plastic tubs, cutlery and bags from restaurants.
He also plants his own crops and herbs at home and at the Sheikh Zayed store, from basil and rosemary to beans, squashes and papayas. “If you’re going to water anything, better it be tomatoes and cucumbers, something edible, than grass,” he says.
“All this throwaway plastic - cups, bottles, forks - has to go first,” says Mr El Accad, who has banned all disposable straws, whether plastic or even paper, from the café chain.
One of the latest changes he has implemented at his stores is to offer refills of liquid laundry detergent, to save plastic. The two brands Organic Foods stocks, Organic Larder and Sonnett, are both “triple-certified - you could eat the product”.
The Organic Larder detergent will soon be delivered in 200-litre metal oil drums before being decanted into 20-litre containers in-store.
Customers can refill their bottles at least 30 times before they start to degrade, he says. Organic Larder costs Dh35.75 for one litre and Dh62 for 2.75 litres and refills will cost 15 to 20 per cent less, Mr El Accad says.
But while there are savings to be had, going green tends to come with upfront costs and extra work and planning. Are we ready to refill bottles rather than throw them away? “You have to change,” says Mr El Accad. “I can only make it available.”
Favourite hobby: I love to sing but I don’t get to sing as much nowadays sadly.
Favourite book: Anything by Sidney Sheldon.
Favourite movie: The Exorcist 2. It is a big thing in our family to sit around together and watch horror movies, I love watching them.
Favourite holiday destination: The favourite place I have been to is Florence, it is a beautiful city. My dream though has always been to visit Cyprus, I really want to go there.
Director: Paul Weitz
Stars: Kevin Hart
3/5 stars
SCORES IN BRIEF
Lahore Qalandars 186 for 4 in 19.4 overs
(Sohail 100,Phil Salt 37 not out, Bilal Irshad 30, Josh Poysden 2-26) bt Yorkshire Vikings 184 for 5 in 20 overs
(Jonathan Tattersall 36, Harry Brook 37, Gary Ballance 33, Adam Lyth 32, Shaheen Afridi 2-36).
Syria squad
Goalkeepers: Ibrahim Alma, Mahmoud Al Youssef, Ahmad Madania. Defenders: Ahmad Al Salih, Moayad Ajan, Jehad Al Baour, Omar Midani, Amro Jenyat, Hussein Jwayed, Nadim Sabagh, Abdul Malek Anezan. Midfielders: Mahmoud Al Mawas, Mohammed Osman, Osama Omari, Tamer Haj Mohamad, Ahmad Ashkar, Youssef Kalfa, Zaher Midani, Khaled Al Mobayed, Fahd Youssef. Forwards: Omar Khribin, Omar Al Somah, Mardik Mardikian.
