Epsilon Theory: Proof of Plant for Crypto


I’ll say this about the energy consumption of Bitcoin, though. In a very fundamental way, money IS a store of energy, or at least a persistent representation (a token) of energy. Money, broadly understood, is the primary way in which we store the energy of our human labor and time and life across time and geography, converting something that is entirely nonfungible, like a good idea or an hour’s labor, into something that can be saved or traded or divided or combined. That’s what money DOES. Bitcoin – or any proof-of-work token – crystallizes this basic property of all money with the intentional consumption of energy in the “mining” of a coin. It’s a very in-your-face way of creating a persistent representation of energy and thus value!

But every cryptocurrency, every coin, every token, whether it’s based on proof-of-storage or proof-of-stake or proof-of-whatever, is doing the same thing, just in a less in-your-face way than a proof-of-work token. Ditto for a gold or silver coin. It’s a representation of a store of energy. Ditto for a dollar bill. Everything we think of as money is a representation of a store of energy, each wrapped in a different narrative to capture our imagination and allegiance.

I can’t emphasize this point enough. It’s at the heart of the entire Epsilon Theory project. Narrative and story are the engine of value for everything in our social worlds, and nowhere does this manifest more powerfully than in the phenomenon of MONEY. There’s no there there when it comes to money. It’s all narrative. It’s only narrative. That’s utterly obvious when it comes to crypto, where Elon tweets and Shiba Inu memes create and destroy fortunes, but it’s just as true with dollars and euros and yen and renminbi, where the tether between taxes and spending – the most important policy relationship in our social lives – is now well and truly snipped.