The founder of Microsoft is considered one of the most vocal skeptics of technology.
Bill Gates has shaped modern life through his innovations like no one else has. Yet he doesn’t think much about cryptocurrencies. In addition to investor legend Warren Buffett, the founder of Microsoft is considered one of the most vocal skeptics of technology, having expressed his concerns in numerous interviews over the years. Notably, Gates does not have cryptocurrencies.
Crypto’s main banefit? According to the founder of Microsoft, drug trafficking and tax evasion. Gates sees a climate killer in Bitcoin, claiming that “it uses more energy per transaction than any other method we know of.” How justified are his criticisms?
Bill Gates, as quoted at Reddit AMA in 2022, said he invests “in things that have a valuable result. The value of companies is based on making great products. The value of cryptocurrencies lies solely in speculating what someone else will pay for them in the future. They have no added value for society.”
Money Laundering with Cryptocurrencies
“The anonymity of cryptocurrencies makes them particularly problematic when it comes to money laundering and illegal activities,” Gates said to Forbes in 2018.
Eldorado’s reputation for money laundering has accompanied cryptocurrencies like Bitcoin for a long time. The fact is that in the last five years, 33 billion US dollars have been laundered around the world with the help of cryptocurrencies. There was a 30 percent increase in 2021 alone, according to US data service provider Chainalysis, which has been investigating crypto-financial crime since 2014. For comparison: In Europe alone, between 715 billion and 1.87 trillion euros are laundered with the euro each year, according to the United Nations Office on Drugs and Crime (UNODC).
Cryptocurrency transactions are stored on Blockchains for all to see. So they are not really anonymous. This transparency makes it easier to prosecute financial crimes, as experts like Chainalysis repeatedly highlight. In fact, data service providers and authorities have been able to clear up many frauds, hacks, as well as money laundering activities, in the cryptocurrency sector in recent years, and they have convicted the people behind them.
Bitcoin Harmful to Climate
A single bitcoin transaction consumes approximately 700-kilowatt hours of electricity, as much as an American household consumes in 24 days. In general, the Bitcoin network consumes as much energy as in countries like Finland or Austria. Therefore, Bitcoin is without a doubt a huge energy consumer.
Most of the energy is used for what is known as mining. New bitcoins are “mined” and distributed as a reward for maintaining the network. The high power consumption thus contributes directly to the security and decentralization of Bitcoin.
High energy consumption is not automatically bad for the climate. It is more important where the energy emerges: from renewable sources or from fossil fuels? Unfortunately, there are no reliable figures for this, as empirical evidence is scant, thus, scientists use estimates.
By Audy Castaneda