Catherine Wood, Founder, CIO, and CEO of ARK Investment Management has addressed bitcoin fear, uncertainty, and doubt (FUD)associated with the cryptocurrency’s energy consumption and use in criminal activity.
In a new video, Wood told ARK Invest’s nearly 300,000 YouTube subscribers she believes that U.S. Treasury Secretary Janet Yellen is wrong about bitcoin in her assertion the flagship cryptocurrency is “extremely” energy inefficient and is widely used for illicit transactions.
In the video, first spotted by Daily Hodl Wood said that Yellen had gone “out of her way to telegraph how speculative Bitcoin is and how it’s not environmentally friendly or sustainable.” Per the CEO of Ark Invest, Yellen does not understand the cryptocurrency space and is instead “responding to a movement in price.”
To address the FUD Wood pointed her viewers to a white paper written by Yassine Elmandjra debunking the idea that BTC is inefficient when it comes to energy. The document asserts the amount of energy BTC consumes if a fraction of the energy used to mine gold and maintain the traditional financial system.
The white paper adds that Bitcoin, through the use of blockchain technology, allows for “much more rapid settlement of trades and transactions than the traditional financial institutions,” as transactions can be confirmed in 10 minutes, as opposed to a few days or even a week.
Think about the energy consumption of the traditional financial world and you’ll see in that chart what Bitcoin is using in terms of energy right now, which is mostly renewable by the way, hydroelectric and other renewables, is again a fraction. It hardly measures up at all to that.
Wood then addressed the idea that bitcoin is used to encourage criminal activity. Per her words, as the blockchain is publicly accessible it makes it easier for anyone to track down illicit movements. She quoted an FBI agent saying that it’s “the best thing that ever happened to us.”
According to Forbes, a Chainalysis report published this year revealed that, in 2019, criminal activity represented 2.1% of all cryptocurrency transaction volume, or about $21.4 billion. By 2020, the criminal share of all cryptocurrency activity dropped to 0.34%, or $10 billion.
On the other hand, the UN estimates that between 2% and 5% of global GDP – between $1.6 trillion and $4 trillion – is connected to money laundering and illicit activity.
As reported, Cathie Wood has earlier this year argued there is “no better hedge against inflation than bitcoin,” as she believes gold “has been moving although not it’s lagging bitcoin fairly dramatically.”
Featured image via Pixabay.