From the Washington Post (might be behind a paywall unless you clear your cookies):

“Bitcoin has been around for more than a decade, yet it remains an inconvenient way to pay for things, inferior to dollars or credit cards in almost every way. Most merchants don’t take it, so in the United States, it’s mostly used by devoted hobbyists, though firms such as Tesla are trying to make it a bit more mainstream.

“Those issues are somewhat related to a larger problem: For technical reasons, transactions are slow to clear, and that decentralized network uses a lot of processing power, making it challenging to scale beyond a devoted fanbase. Some of these problems can be worked around by creating another layer on top of the bitcoin network — but at that point, it’s unclear why anyone would prefer a third party denominating transactions in bitcoin rather than a stable, spend-anywhere currency such as the U.S. dollar.

“One could argue, of course, that one shouldn’t think of bitcoin as a currency at all, but as an asset. Certainly it’s hard to argue with the way its price has appreciated. And yet, my inner skeptic keeps asking: What is bitcoin actually good for?”

Here’s a lesson from Tokyo:

“After decades of remarkable growth, Tokyo real estate was so valuable that at one point in the 1980s, the Imperial Palace was theoretically worth more than all the real estate in California. Eventually, however, prices require some sort of pragmatic anchor, or else they collapse; after Tokyo real estate prices finally crashed, it took decades for prices to even approach their previous peak.”

And a very good point about ‘value’ and expensive rings:

“To some extent, all value is a collective hallucination. Those rings are beautiful, but they are not objectively several thousand times more beautiful than stainless steel and cheap crystal. If the market wants to slap a similarly elevated price on elegant technical solutions to gnarly game-theory problems and call it a cryptocurrency, who am I to gainsay it? Why shouldn’t it be a small but significant alternative investment option, just like silver and gold?”

Even though bitcoin is designed so that the number of bitcoins can never exceed 21 million, getting there means pumping out crazy amounts of Co2 (from electronically ‘mining’ the coins). Already bitcoin mining requires more electricity that Argentina or The Netherlands, and the last time I looked, the world doesn’t run on renewable energy quite yet.

Here’s a graph showing the carbon footprint of the electricity mix used to run countries, and mine bitcoin:

Yikes.

As the environmental impact of this craziness becomes clear to a wider audience, they’re going to have to find another way to ‘mine’ bitcoin than pumping Co2 into the air, or simply fade away in a big crash.

To me, deep down bitcoin feels like just another pseudo-pyramid scheme where the aim is to get out just before it crashes.

Good luck to you Bitcoiners when trying to correctly pick the moment just before it all goes pear-shaped.