To start, it
seems very difficult to classify the bitcoin as a unit of account of energy
because this cryptocurrency does not exist physically, but guess what? The
energy does not exist either. Surprising as it sounds, you are never going to
see a particle of energy, or catch the waves of energy. Its concept and
definition, which in my view is one of the great achievements of science, is
the way we explain the conservation of movement. All energy is a form of
motion. Heat is vibration of molecules, electricity are moving electrons. Etc.
But physical pieces of energy won’t ever be seen.
But that's not
enough to say that Bitcoin is energy. What does the value of Bitcoin indicate?
Well, it has always been rather difficult to define. Some say it is virtual
money, others say it really is a commodity. Actually, the Bitcoin is the value
of the energy used to mine and validate it. This currency unit is not created,
it is found in a blockchain using fast computers to decrypt it. As the first bitcoinsare
found, successive ones are increasingly difficult to decrypt. Exactly like a
mine where as a vein is exploited, you have to dig deeper each time to continue
extracting the ore. In that sense the Bitcoin is an authentic mining process.
Now, we do not
feel in our daily lives that energy is so important, because ultimately how
much we spend per month to pay the electricity bill? Say 2% of our salary.
Insignificant.
Not so fast.
Do not forget that cooking gas is also paid for its ability to generate heat,
is another energetic. And gasoline or diesel car are also an energy. Then we're
coming for 10% of our expenses. Now, that other expenses that we can be counted
as energy? All other material or product we buy, from clothes to food, have in
their price, the cost of energy used to produce them. For example, plastic.
While enough energy is used to melt the plastic and turn it into what we need,
the same plastic also needed energy for processing be it the pumps for oil
extraction, or refining it by heat. In fact most of the cost of plastic is
energy. Similar analysis can be made for all the things we use. So we actually
have a very high cost of energy in what we buy daily.
But we can not
easily transform that energy into things we need. It is true, that is why we
need a market economy and other workers performing these operations. The only
power we control are the basic, where the process of energy consumption
realized by us: electricity, gas and gasoline. However, what if we started
printing 3D printers part of the plastic supplies we need? And if instead of
using paper better use internet connections and multiple monitors? Then our
direct energy use increases.
ARE THERE
BANKS OF ENERGY?
In fact there
is already a unit of energy account. In civilized countries, people who have
solar panels on their roofs can feed unused electric current into the public
electric grid during the day and the electric meter deducts that amount so you
can use it at night. Thus it was created the first virtual energy storage.
Countries whose legislation provides the option of feeding back energy to the
system, have created not financial but true energy banks.
You can say
that there is no need to change currency. In fact, there is. Not because Uncle
Sam dollars have been universalized, it means it is the best way to store
value. It is relatively stable, but still subject to inflation. It happens that
the inflation process occurs when there is excess cash. There is excess dollars
when the US government needs to make extras for "special services"
payments and must apply to the Federal Reserve some cash (a few billion, to be
precise) also by the immense amount of dollars counterfeited without being
detected. This injects money in the world and the dollar loses value, adding to
the fact that it is already overvalued. It has been an obsession in the history
of humanity, find a coin that has an intrinsic value. This means, whose market
value as a monetary instrument is the same as the material it is made of. So
the value of gold was always so convenient. Energy also has intrinsic value.
And it has
value because of its ability to perform work. A lot of energy will make a lot
of work, regardless of country, political system, religion, financial model or
any other social criteria that use a country, which usually has great impact on
the value of money. Energy, from that point of view is the most universal thing
in existence.
Financial
imbalances and recessions, inflations, runs, and others occur precisely because
there are different currencies and transactions whose changes influence each
other, and also the method of issuance and administration of governments.
HOW WILL
ENERGY COMPANIES CREATE MONEY?
In much better
way than print or create fictitious credit with executive orders.
It has to be
said, that electric companies do not sell all the energy they generate. Usually
they generate enough to cover the maximum demand at peak hour. All the energy
that can not be sold is wasted because it is very difficult to store electrical
energy. This differs from money, which is quite easy to store but difficult to
produce.
This wasted
energy can be used for mining bitcoins. So that electric companies have a
background extra bitcoins. In fact banks will have a power reserve of bitcoins
representing all those kilowatts unsold.
We must be
careful not to pay double. What we pay for electricity tariffs include the
kilowatts that could not be sold. Therefore, if the company will generate
bitcoins with those leftover kilowatts, that should be deducted from the
electricity tariff and therefore electricity tariffs should lower.
When the user
needs to withdraw money from the energy bank, it can send the user money from
his account as bitcoins directly to his electronic wallet on his cell phone or
other device, thru the Internet and the user will have instant energo-cash.
If the user
wants to deposit energy in his account, he can send it directly from his
device, or (more interestingly) inject energy from the photovoltaic panel on
the roof of his home. The special meter will count the kilowatt-hours injected
and will credit it to the user’s account in the form of kilowatt-hours storaged
or bitcoins.
Since the
value of bitcoin is given by the energy and those external services used to
mine them, their value may vary very little from the kilowatt-hour and also
trading on the market will be validated by the supply and demand of the
millions of miners who will also be mining
bitcoins. In this way a perfect market will be established.
PAY SALARY IN
ENERGY?
That is why it
is important to anticipate events and start regulating how utilities perform
transactions with the injected energy.
That energy,
will be posted to the user's account as credit. So already managed to have an
account with virtual money, he can cash it at will.
If a company
wants to pay the salary to the user as energy or bitcoins will be a matter of
the user, since the correct convertibility is ensured.
BUY WITH ENERGY?
goods and
services will be purchased analogously as with dollars and credit cards. It
will be made by payments in bitcoins, and for other transactions, checks or
direct transfers energy units (Joules, Kilowatt-hour or megwatt-hours).
Depending on the user's convenience. Bank loans will be made in the same way.
AND INTERESTS?
This is the
best part of this type of unit of account. Interest shall be capitalized
differently. Let's see. Interest exist in the current monetary system, due to
the characteristic of being relatively scarce, and money being difficult to
generate, but quite easy to store. In an energy market where energy is
difficult to store but easy to generate, interests should be much lower because
of the cost of interests of energo-cash will be paid by the borrower in the
form of storage energo-money. That is, in a market in which money (energy) can
not be stored and must be discarded if it is not stored, it is best to lend
someone to retrieve it in the future, even without charging interest, therefore
the energo-effective it will be much more accessible and lower interest rates.
FUTURE
DEVELOPMENT OF ENERGY MARKET
An energy
market has many advantages. The intrinsic and interchangeable energo-money
value, the possibility of better living. I explain. With 3D printers, many of
the supplies we buy, can be printed, so that the cost of owning them is only
the power to print and the material, which is plastic and therefore is mostly
energy. Hopefully this type of market will produce much greater social wealth. An
energy economy would create an expanding market, better ways of doing things in
terms of energy instead of matter. Wars for resources would diminish. It is
difficult to predict where innovation will go, but the truth is that the
concept is possible.
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