Promotion, Cabal, Attack on BTC, or Pointless?

Source: Adobe/Myst

The decision was reached in the meeting between Bitcoin (BTC) miners, the chiefs of a few investment and tech companies, and some billionaires to form the Bitcoin Mining Council. And while some think of this as a good idea and a way to promote Bitcoin, others very much oppose it, calling it an attempt to control Bitcoin by agenda-driven regulator-pleasers.

Hours ago, the MicroStrategy head and crypto bull Michael Saylor notified the general public that in the meeting he hosted yesterday between Tesla‘s chief Elon Musk and certain miners in North America, “the miners have agreed to form the Bitcoin Mining Council to promote energy usage transparency & accelerate sustainability initiatives worldwide.”

According to Saylor, attending the meeting were the executives from Argo, Blockcap, Hut 8, Marathon Digital Holdings, Riot Blockchain, Core Scientific, Galaxy Digital, and Hive Blockchain Technologies.

These are now the founding members of an organization that, per Saylor, aims to standardize energy reporting, pursue industry environmental, social and corporate governance (ESG) goals, and educate and grow the marketplace.

Argo CEO Peter Wall also commented on the “ground-breaking” meeting, stating his company “will push hard for sustainable mining and more transparency.”

Wall added in an email that it was “a good day for the planet,” and that the Council is “the next logical step in fostering a sectoral shift towards renewable energy.”

Musk, who recently made headlines for criticizing BTC and its energy consumption, affecting the coin’s price, described the council formation as “potentially promising.” The North American Bitcoin miners have committed to publishing current and planned renewable usage, he said, and to ask miners worldwide to do so.

Cabal, an attack, a good idea, or entirely pointless?

Many in the Cryptosphere did not like what they perceived as a secret meeting between miners and billionaires, suggesting it may have been just a smokescreen for investors and governments.

This being a closed meeting, it violates the open-source and decentralized ethos of the project and sets a bad precedent, said Redditor ‘itcouldbefrank’, who finds it worrying that billionaires are acting as regulators in the cryptospace, while potentially furthering their own agendas.

Sébastien Gouspillou, co-founder of Bigblock DataCenter, seems to agree, suggesting talking to coal producers and major coal users instead.

go see the banks that finance them! and get off the miners’ back. We only use electricity, exactly as the @Tesla cars.
— Seb Gouspillou ⛏ (@SebGouspillou) May 24, 2021

Similarly, Marty Bent, co-founder of Great American Mining, opined that if there are “valid ESG concerns” about mining Bitcoin with coal, then there also must be some about using coal and slave labor to produce solar panels.

In his newsletter, Bent repeated, like many others, that the history showed that closed-doors meetings are not good for Bitcoin.

“It’s a bit concerning that this group of people felt compelled to appease Elon Musk after a deranged tweet storm that proved without a shadow of a doubt that he does not understand Bitcoin and its Proof of Work consensus mechanism, he said.”

Knox founder Thibaud Marechal, as Bent, called the move “an attack on bitcoin,” and an attempt to control it, adding that energy prices are set by the free market competition among miners. “Bitcoin needs no kings. No sustainability council.”

Bringing the ESG movement to Bitcoin is an attack on Bitcoin and it should be called out as such.
The ESG movement doesn’t care about the environment or humanity, it cares about control over capital allocation and how corporations act.
— Marty Bent (@MartyBent) May 25, 2021

But according to Nic Carter, Partner at Castle Island Ventures, there is no cabal there, and it all sounds scarier than what it actually is, which is “miners accounting for 10% of hashrate agree to disclose basic information that many of them were already disclosing anyway.” There are no protocol changes to it. Carter called this “a good idea,” despite Musk not being the best poster child for it.

CEO of Bitcoin Investment Group Eric Weiss argued that “some influence coming together to try to make [Bitcoin] more environmentally friendly neither invites regulation nor threatens bitcoin in any way,” and that this is Bitcoin growing up.

But for others, this may (again) be too much about Musk. Data scientist and Nansen CEO Alex Svanevik wrote that “Bitcoin’s energy profile will improve, and Elon will get credit. He likes being the hero.”

And there are those who suggested that this all may have been for nothing – and for various reasons.

Knut Svanholm, the author of ‘Bitcoin – Sovereignty Through Mathematics’, argued that the council may help promote Bitcoin, and that it won’t be able to change the rules. He wrote that “the miners are the users’ slaves, not their masters. The system wouldn’t work if it was the other way around. We run whatever software we want. Miners run whatever software that is profitable for them to run.”

“Can’t wait ’til you figure out that the incentives drive miners to use cheap stranded / renewable energy,” Bitcoin developer and Casa Chief Technology Officer Jameson Lopp replied to Musk’s tweet.

Furthermore, Vili Lehdonvirta, Professor of Economic Sociology and Digital Social Research at Oxford Internet Institute, opined that the blockchain’s governance paradox is that once an institution needed to govern it is developed, “then you no longer need it.”

just setting up my twttr
— jack (@jack)

Mining councils are not a matter to worry about, argued Blockstream Chief Strategy Officer Samson Mow – rather, the focus should be on finishing the upgrade to the Bitcoin mining stack called Stratum V2, and getting widespread adoption.

“If the Musks or Saylors of the world actually cared about energy use they would be loudly celebrating the Bitcoin mining industry due to the fact that it has the HIGHEST PENETRATION OF RENEWABLES AS AN ENERGY SOURCE OF ANY INDUSTRY ON THE PLANET,” said Bent, while investor Preston Pysh opined that Bitcoin is “the ultimate global ESG incentive structure as it exists.”

just setting up my twttr
— jack (@jack)

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Other reactions:

Bitcoin Mining Council: Promotion, Cabal, Attack on BTC, or Pointless? 102

just setting up my twttr
— jack (@jack)

These two charts render this entire conversation moot. The conversation should never have even started. pic.twitter.com/NoUkYtwHcF
— Friar Hass (@FriarHass) May 25, 2021