MARGOTBITS Robotics, Science, and Other Interesting Tidbits

Originally published on Medium on June 29, 2022.

This issue’s topic: The IPCC’s Shared Socio-Economic Pathways

Bitcoin and degrowth aim for the same goals. Localism, end to debt money and living frugally. Photo credit: Kaique Rocha.

Just thoughts on the connection between bitcoin and elements of the “degrowth” movement that argues that never-ending economic growth is leading us toward an unsustainable and ecologically destructive path.

I’ll get back to last week’s discussion next week. Today’s newsletter is about bitcoin and the IPCC’s shared socio-economic pathways.

I recently had a discussion with a really wonderful person named Harald Rauter. The rest of you will get to know him soon, as I think he will be an upcoming guest on one of the major bitcoin podcasts later this summer. Harald reminded me that one of the recent IPCC reports incorporated the shared socio-economic pathways models into their various emissions pathways. These pathways are important because they tell us how well-equipped the world is to limit warming.

There are 5 pathways and the IPCC holds that SSP2–4.5 is the most likely path based on the Paris Climate Agreement and current government policies. The IPCC also says that SSP1–1.9 and SSP1–2.6 are still possible. But actions speak louder than words and our current trajectory is more like SSP3.

Here’s how Gizmodo describes the SSP3 pathway.

Imagine a world fractured into rival factions, countries distrustful of one another and unwilling to cooperate. Nationalism is on the rise with authoritarianism on the horizon. Inequality is also climbing, and the resource curse is alive and well. Rich countries plunder poorer ones, leaving behind a wave of environmental degradation, all so consumers can have material-intensive bric-a-brac. Conflict is a constant specter.

Dr. Peter Carter, a long-time reviewer for the IPCC, commented in a new video that the recent UN Bonn climate meeting is a disaster, with a total lack of cooperation from the heavily polluting nations. Nations like the United States, China, and India, are refusing to live up to their commitments. Instead of working together to solve the crisis, our leaders are delaying action.

The five shared socio-economic pathways. We’re living through something like SSP3 and SSP4. Credit: Riahi et al, poster.

Dr. Carter made it clear, that our trajectory is one of constant, unbound economic growth which will lead to more emissions. In my opinion, we should be more focused on how to keep emissions low under more challenging scenarios, because actions speak louder than words. As we have seen play out this year, the words of the Paris Agreement are meaningless when nations go to war. European countries are restarting coal production in response to Russia curtailing its natural gas exports.

According to the modelers, under SSP3, there’s no combination of scenarios that keeps the hope of global warming below 2 degrees Celsius alive. This brings me back to Harald because he made such an eloquent point. We have a way that we can make SSP3 work and we need bitcoin to do it.

That’s an extraordinary claim and probably leaves a lot of skeptics out there even more incredulous. But, what other tool out there can make players in a game do what is best in their self-interest and that of the group?

We live in a gamified economy that is run on an incentive called profit. Our system has many bad incentives and they are hard to change because they are built into the fundamentals of the system. However, we have a tool that allows us to play the game but provides incentives that change the outcome.

Yes, in some instances bitcoin was used to save a few fossil fuel plants, but that’s only showing what it’s capable of doing, regardless of energy source. In the next chapters of bitcoin and energy, we’re going to see how bitcoin does the same thing for renewable energy (and nuclear), but at scale. This is where we need to shape the game to save ourselves from catastrophe under SSP3. Bitcoin allows us to work from fundamental incentives, within a world that refuses to cooperate.

If we want to reduce consumption in the rich nations and allow for development in the poorer ones, then we need to use all possible tools including bitcoin. Degrowth won’t happen within the existing system. We have to exit the system. Bitcoin is a monetary network for a civilization that cares about the connection between the environment and economic growth. Bitcoin is a check on that. We now have a tool that allows us to modify the incentives of the game that has us on the SSP3 pathway and we must learn how to use it.