In a one-on-one discussion during this year’s Camp Ethereal, sponsored by Decrypt, the renowned philosopher Peter Singer spoke with FTX founder and CEO Sam Bankman-Fried on a collection of topics that ranged from the Russia-Ukraine conflict to how crypto affects the environment.
As an ethicist, Singer was keen to pick Bankman-Fried’s brain about the moral role of crypto in today’s world. He began by raising concern over the industry’s energy consumption.
Bankman-Fried responded by saying that lowering crypto’s carbon footprint is something that “needs to be taken on,” and that current proof-of-work blockchains like Bitcoin and Ethereum were a “non-starter long term” because of high energy costs, which in turn lead to high transaction fees.
He also told Singer that alternative proof-of-stake protocols have “effectively zero environmental impact.”
“We sort of have to end up living in a world where most of that scaling is happening through proof-of-stake systems,” Bankman-Fried continued, adding: “I think one of the most fortunate things is that that’s going to have to happen anyway. For economic reasons, there’s a lot of economic pressure to fix this.”
Singer, a professor at Princeton who’s written and spoken extensively about altruism, also wanted to know whether Russia could use cryptocurrencies to dodge sanctions imposed after the nation’s invasion Ukraine, noting that with crypto one question “often raised is, does this—is this—a way in which the criminal underworld can can move money, and be protected from that being exposed, or people who are trying to avoid paying taxes.”
“We haven’t seen any attempts from Russia to move money through crypto,” replied the FTX CEO. “It is actually a little bit surprising to me the extent to which we haven’t seen that.”
Relatedly, Singer and Bankman-Fried discussed how much of the aid channeled to Ukraine has been in cryptocurrency—“tens of millions given through crypto so far,” Bankman-Fried noted, adding how “it’s a cool example of banking the unbanked.”
A “big positive,” noted Singer, “is if there are people who have crypto and that they’re interested in donating to effective charities, then that’s a huge plus that comes out of this.”
The Russia-Ukraine conflict, Bankman-Fried added, illustrates a different version of unbanked or underbanked populations who could benefit greatly from increased financial opportunities.
“If there’s a tank outside your bank,” the FTX CEO continued, “you’re going to me more underbanked than you thought you were, so it’s really been cool to see [crypto] give an international financial lifeline.”