Security is costly. The article I have linked to (see link below) examines the relationship between energy consumption and the security of the Bitcoin processing network. And, the author has identified the mostly hidden cost of keeping that network secure, the energy it takes to compute the blockchain that supports Bitcoin transactions. Lowering the energy footprint (which to article makes a good case is enormous) would mean a less computationally intensive process and that would make it easier to to compute the hashes and make it more likely that someone could co-opt the network.
The question is one of balance. How difficult does the hash need to be to deter someone from successfully gaining control of the network and what does it cost (nothing is free) to maintain that level of security. You don’t want it to be too high (where the cost of security prices Bitcoin out of the market) and you don’t want it to be too low (where the network gets compromised and people lose money). And, it seems to me that the balance between lower cost and higher security should be biased toward security, Bitcoins represent money after all.
That said, I still don’t think (and am even more convinced than ever) that Bitcoin does not represent a replacement for legal tender, it is a payment system. I also have begun wondering why the idea of a true electronic currency hasn’t garnered more interest.
Finally, I think Bitcoin is a good first attempt. It gives us all lots to think about and its shortcomings will provide input for the next generation of both payment systems and the first generation of electronic currency, i.e. legal tender. So, I for one will continue to pay close attention to its adventures.
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