Argentine billionaire and CEO of the e-commerce platform Mercado Libre, Marcos Galperin says bitcoin is a better store of value than gold. However, the billionaire thinks the crypto will not replace fiat currency due to what he terms the high “energy cost required to process its transfers.”
Bitcoin Mining Energy Consumption Misconception
Galperin, who has an estimated net worth of $7.7 billion, made the remarks when responding to an inquiry from a Twitter user. The user wanted to know if the billionaire was a BTC holder as well as his opinion on the possibility of Argentina adopting cryptocurrencies.
Although Galperin dismisses the idea of cryptocurrencies actually replacing fiat currencies, he does, however, think that “quantum computing” can solve the challenge of high energy costs which he believes to afflict the Bitcoin network.
However, the billionaire’s remarks about the bitcoin network energy costs prompted a response from bitcoiners. For instance, in their response to the billionaire’s tweet, one user going by the name Martín Morando agrees with the first part of Galperin’s comments. Nevertheless, the user is quick to explain to the billionaire that his understanding of bitcoin mining may not be correct.
In his tweet, Morando says, “the energy cost is not a problem (but) it is part of the combo.” He adds that “most of the energy used is renewable.” The Twitter user then refers the billionaire to a website that debunks the theory that bitcoin mining is energy inefficient.
On the other hand, another user Ibarra Gustavo poses a question to Galperin:
In Mercado Libre and Mercado Pago have they measured how many k.w.h they consume to process money transfers with all credit card and Mercado Pago entities that operate?
Still, other users like Matias Walkoski are skeptical of Galperin’s opinion that quantum computing will prove to be instrumental in hastening BTC adoption. Instead, Walkoski thinks all “a quantum computer could do is make BTC’s cryptographic keys hackable.”
Another Deluge of Pesos Coming
Meanwhile, as Galperin is lauding bitcoin, reports were emerging from his crisis-laden home country that it wants to inject new money. Some experts believe Argentina’s planned injection of $12 billion worth of new money, which is less than the $16.4 billion injected in 2020, will worsen the country’s current plight. As of December 2020, Argentina had a reported inflation rate of 40% while its currency depreciated by as much as 94% against the U.S. dollar.
According to one report, economic experts are predicting that the planned injection of new money will result in the significant depreciation of the peso and a higher inflation rate. Therefore, to escape the expected currency depreciation, the experts are encouraging Argentines to use “the crunchy pesos to buy bitcoin.”
Do you agree with Galperin’s remarks that BTC will not replace fiat currencies? Tell us what you think in the comments section below.