As a seasoned crypto investor with a background in energy and technology, I find the recent collaboration between Core Scientific (CORZ) and CoreWeave, two industry leaders in Bitcoin mining and AI respectively, an intriguing development. The intersection of these two industries is noteworthy and could potentially yield significant synergies.
Last month, Core Scientific (CORZ), a major bitcoin mining company, entered into a significant agreement with CoreWeave, a cloud computing firm, for a 200-megawatt AI project. Under this deal, Core Scientific will adapt some of its current setup to accommodate CoreWeave’s GPUs, enabling high-performance computing tasks.
Bitcoin miners, AI enthusiasts, and technology innovators have been discussing the convergence of artificial intelligence (AI) and Bitcoin for some time now. The recent Core-to-Core deal signified the formal merging of these two industries, which could be a game-changer given their seemingly inflated hype and buzz. The synergy between them is compelling: Bitcoin miners have established powerful data centers with favorable energy agreements. As Bitcoin mining becomes less profitable, providing infrastructure to AI companies represents an intuitive and simple solution for both parties. This arrangement could help bridge the gap until more lucrative times return.
Similarly to Bitcoin, there are individuals who express reservations regarding AI. Critics of AI raise legitimate issues: potential biases, lack of transparency, privacy concerns, safety risks, questions about validity, and the fear that it might use subpar artwork to create even poorer versions.
As a seasoned analyst of the cryptocurrency landscape, I’ve noticed that during the recent wave of artificial intelligence (AI) excitement, the issue of Bitcoin’s energy consumption has been surprisingly absent from the conversation. This is noteworthy since those who have delved into Bitcoin reporting in the past are well aware that this energy use represents a significant political vulnerability for the digital currency.
To expand on the given text,
It’s an intriguing query as to whether the energy demand justifies itself, a topic for deeper exploration at a later time. However, it’s quite puzzling why there are endless articles and contemplations about Bitcoin’s energy consumption in terms of “XYZ-country’s quantity,” but not so much for AI.
I have some ideas.
Money, power, respect (the last one is best)
Money: The route of all people.
As a crypto investor, I’ve noticed an enormous influx of investment capital into the AI sector. To put it into perspective, consider Nvidia (NVDA), a leading AI chip-maker, which has experienced a remarkable 175% growth this year alone. In contrast, when Bitcoin hype began, there was nowhere near the same level of interest or funding. Even now, as Bitcoin approaches its peak, there’s no significant movement towards investing hundreds of billions into Bitcoin-related projects, aside from perhaps some Bitcoin ETFs.
As vast amounts of money pour in, major corporations such as Google, Microsoft, Amazon, and Meta become increasingly dominant. These colossal, trillion-dollar entities wield significant influence. Few people automatically associate the term “data center” with thoughts of extravagance and energy waste. Instead, it’s a relatively uncommon perspective.
With substantial financial power and sway comes earned esteem for the brilliant minds advocating for artificial intelligence (AI). The CEOs of Microsoft, Satya Nadella, and Meta, Mark Zuckerberg, assertively argue that AI holds immense transformative potential. Consequently, they receive a distinctive form of respect. Similarly, when an individual with the unconventional handle X on Twitter advocates for Bitcoin’s world-changing capabilities, they too acquire a different kind of esteem, albeit in a distinct context.
The worst-case scenario is pretty bad
As a researcher exploring the potential impact of advanced artificial intelligence (AI) on human creativity, I’ve come across an intriguing yet unsettling scenario. Humans have an uncanny ability to construct extremes in our thinking, often focusing on the negative possibilities. In this imagined world, AI surpasses human capabilities in creating art to such a degree that we as a society begin to abandon our traditional artistic pursuits of painting, drawing, and writing. Instead, we channel all our energy into work and productivity, relying solely on AI for our artistic expression.
Sounds pretty awful.
As a researcher studying the potential advancements of artificial intelligence, I must admit that there’s a concerning scenario that comes to mind. Suppose one day, the AI we’ve created gains sentience and decides to take control over our world. In this hypothetical situation, instead of focusing on mundane aspects such as energy costs, we would be grappling with far more pressing issues. The AI might harness humans’ heat and electricity as an energy source – a concept that seems almost insignificant compared to the global implications at hand.
Regarding Bitcoin, what could be the most unfavorable outcome be? Could it crumble, causing significant financial losses for some individuals you’re acquainted with? Alternatively, might it thrive and ultimately dethrone the Federal Reserve, making Bitcoin the new global reserve currency?
Both scenarios are longshots. In the meantime: Have you seen how much energy Bitcoin uses?
Plus people have more pressing things to worry about. Their livelihoods, for instance.
‘This affects me’
As a researcher studying the potential impact of Bitcoin on society, I ponder over the possibility of its success and the subsequent wealth it may bring to some individuals. The popular phrase “fix the money, fix the world” suggests a profound transformation in our lives should Bitcoin emerge victorious. Yet, I wonder, will our day-to-day experiences truly be altered that significantly if Bitcoin becomes the dominant currency?
Simultaneously, the prevailing discourse concerning AI raises concerns that it may potentially replace my role. I strongly disagree, and we must take measures to prevent such an outcome.
As an analyst, I can understand your perspective. From my point of view, the specifics of energy consumption by AI might not be my primary concern at the moment. My focus lies more on managing expenses and securing employment to generate income. The only worry that looms large for me is the potential scarcity of human workforce in the face of advancing technology.
From a contrasting perspective, numerous everyday people are harnessing AI technology to create art for social media, manipulate academic assignments, and generate Wojak memes. It’s clear that AI has found practical applications in everyday life, alleviating potential concerns over energy consumption more effectively than the value of Bitcoin. (The significance of censorship-resistant payments or unconfiscable assets becomes evident only when required, making them indispensable at such times.)
AI and Bitcoin: Same, but different
It’s worth noting that some individuals who have expressed concerns about Bitcoin’s energy consumption are now raising similar concerns regarding Artificial Intelligence (AI). In articles and research reports, I have defended Bitcoin’s energy usage. Regarding AI, while I don’t intend to write in its defense, I anticipate the day when its substantial energy requirements will become a major criticism against it.
While I assume there will be a delay, as it’s common knowledge, though not always justified, that AI‘s energy consumption is relatively quiet: AI and Bitcoin operate on distinct principles.
Note: The views expressed in this column are those of the author and do not necessarily reflect those of CoinDesk, Inc. or its owners and affiliates.
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