A magician known as ‘Bitcoin’
Thanks to Bitcoin, we can now sell energy that we otherwise would not be able to sell due to geographical difficulties and their inherent transportation costs. Many places in the world have lots of energy, however, we can’t get to them; thus, that energy usually goes unused. Thanks to Bitcoin, for the first time ever, energy needs not a specific location to be valuable.
If, for instance, someone could make cheap electricity in the middle of the Amazon Forest, how would they store the value of that energy?
They could store it physically, however, they’d run into the transportation problem. For instance, if you stored that energy in batteries or oil, you would need big expensive trucks, trains, and pipelines to transport that energy, which, in turn, renders the cheap electricity — sourced in the middle of the Amazon Forest — unattainable due to the expensive transportation costs. Additionally, if it takes time to transport that energy to populated places where you can sell it, those batteries where the energy is stored eventually lose charge and the petroleum’s potency dissipates.
You could also transport it through power transmission towers, yet the amount of infrastructure required to do that would come at a huge cost, again, rendering that distant and cheap electricity unattainable.
Regardless, if transportation costs were somehow cheap, once you sell that energy, and its value thereafter is stored in the U.S dollars — or whichever fiat currency — you received from the sale, the value of that energy would be poorly stored in those dollars due to the ease with which central banks can alter their supply.
Then there’s Bitcoin…
You could also store the value of that cheap electricity in Bitcoin — since all you need is an internet connection to mine it; this, in turn, allows Bitcoin miners to go anywhere in the world — be it the middle of the Atlantic Ocean or the Amazon Forest — with certainty that they won’t lose the value of the cheap energy extracted from those remote places.
Just like that, Bitcoin has made unattainable energy attainable because bitcoin miners are able to safely store the value of energy from distant sources in bitcoin — energy that would have otherwise never been used due to the remote locations of those energy sources.
A miner in the middle of the Amazon Forest can then sell that Bitcoin to someone in China almost instantly, whilst removing the liability (and common tendency) of energy from remote places losing value. In other words, the value of that energy moves from one place to another without transportation costs, without a loss of energy — be it through a battery losing charge or oil losing its potency — and without the loss of value in a fiat currencies through inflationary practices.
It’s almost magical!
