How Miners will PUMP their Bags | Bitcoin Education

Video Transcript:

hello there and welcome to the Hashpower Academy my name is Jake i’m the lead educator here at the academy and this is a place that we delve into anything and everything to do with Bitcoin and its underlying network of technologies and commodities this is to say that we delve from a fundamentals first perspective going through everything of the energy sector electricity compute power and the export of energy onto the internet to add Bitcoin blocks to the chain which issues and settles Bitcoin transactions with the subsidy adding that full supply of 21 million units now the question of the day is how Bitcoin miners can pump their bags or shall I say compute them because they are producing all of this energy converting it into compute and capturing the amount of Bitcoin that is available within blocks whether it’s subsidy or fees and what I want to delve into is the fact that the total 21 million supply that’s being majority of it is just not moving at all which is good because it’s pricing all of this energy against a smaller quantity of Bitcoin which does raise the purchasing power of Bitcoin because from the mining side of things you’ve got an energy cost with an output of Bitcoin but if you were trying to buy energy on a Bitcoin unit of account in the future this exchange rate favors buyers who are trying to buy this energy with this quantity of Bitcoin when divided down to per Bitcoin or per kilowatt depending on what the the size of the energy purchase is because this creates the curtailment rate of how much you’re willing to sell the electricity to the local grid or compute it into the global money and my overall approach here is it boils down to a statement bitcoin miners need to stimulate economic activity that is to say that yes we can deploy hardware and focus on all of the mining aspects of things but that truly is this tunnel vision focus on the energy sector but the financial sector side of things is where the money comes in that the more transaction velocity the more volume of Bitcoin moving and the demand for block space needs to be stimulated this isn’t just going to occur from the quantity of people joining into the Bitcoin network and yes that will raise the the amount of fees per block and the fee market side of things but we need to stimulate economic activity with this wider pool of 21 million units that is the opportunity because only a small amount is actually traded and the amount settled per day is 0.02% of the supply and so all of these different pieces come into play that this side of things is very clear innovate greater more efficient compute innovate more greater more efficient uh energy production so the two vectors of energy and technology they’re always going to be racing and pioneering their own paths to build out a playing field of opportunity for humanity but on the financial side of things everything in orange here we want to make this number bigger in reference to more economic activity subsidy has a direct relationship to the dollar because there is nothing behind subsidy it’s just a quantity of Bitcoin being issued and because there is a dollarized mindset to people’s attachment to what a quantity of Bitcoin is worth and subsidy has nothing else to it subsidy is going to have that intrinsic relationship to the Bitcoin dollar pricing aspect of things it’s fees a fee is referenced to a larger quantity of Bitcoin in movement and that fee can represent an even larger quantity of Bitcoin in a layer 2 or even layer three as a wider field of economic activity on this side of things we want more of this Bitcoin moving in the sense of economic activity on a Bitcoin unit of account this is why I have started the Hash Power Academy to educate people about these more fundamental layers and finance is still part of this conversation so I hope people have questions queries in the comments because uh I have many ideas as to how we can stimulate economic activity here uh I believe that hash rate has a very strong component in this conversation because it is the bridge between the two worlds it’s the decision maker as to whether to consume that energy into Bitcoin or to switch it off and that creates an aspect of grid and Bitcoin relationship where well the the flip-flop between these two worlds will ensure that Bitcoin has a pricing to electricity and if we can price electricity on a Bitcoin unit of account which is somewhat already happening today the the miners who are buying and selling power on the grid are continually going to correlate the Bitcoin per kilowatt price closer and closer to the average revenue rate of the network as a whole because they are natural buyers above revenue and sell and buyers below uh their revenue rate of Bitcoin per kilowatt and they will sell the energy above their revenue rate of Bitcoin per kilowatt curtailment which is already happening today and so naturally I believe that the price of energy on grids over time with the adoption of Bitcoin mining on the electricity grids everyone talks about uh adoption on the the user consumption side but there’s also the energy production side of things and the adoption curve there so I think the duopoly between energy and finance with compute in the middle is where the education needs to be and where the products services and markets need to be to stimulate more economic activity on a Bitcoin unit of account and compute being that internal medium of exchange between the worlds of energy and finance there’s lots of ideas lots of comments lots of queries that you could share with me in the comments i will see you there hope you enjoyed this video and I will see you in the next one like subscribe and all that fun stuff goodbye