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Jenny Nicholls is a Waiheke-based writer, specialising in science commentary.

OPINION: I have a good friend, a cyber-security expert, who mines cryptocurrency in his laundry, and his mothers basement. This kind of mining doesnt use picks and shovels, but towers of stacked computers linked with fat cables, which look like licorice straps. The air feels warm hot, even, just like inside a real mine.

In winter Patricks mining rigs generate so much heat that it keeps two floors of his mothers four-bedroom house warm; his electricity bill at the address is at least $400 a month.

So far, Patrick says, even though some cryptocurrencies have soared (and plummeted), in value, his hobby hasnt made him rich he has ended up with a lot of shit-coins.

If Id mined Ethereum and banked it Id probably be a few hundred thousand bucks up. But I traded it for shit-coins, hoping those would moon (go up in value) when I should have kept the Ethereum.

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Ill pause here to acknowledge the boyish tang of crypto jargon, in phrases like crypto bros, cryptojacking, lambos (lamborghinis), bags and bag holders, ATH and altcoins, DeFi and getting rekt, or preferably not getting rekt, as this is exactly what it sounds like, just spelled differently.

Patrick mines Ethereum because he loves the mathematical workings of the blockchain, a digital ledger linked together using cryptography a technique used in cybersecurity in the presence of adversarial behaviour, as Wikipedia puts it.

He also likes the way cryptos DeFi, or decentralised finance system, is managed by a network of users, rather than a central entity like the head office of a bank. Patrick thinks banks are bloated and greedy hard to argue with and he sees DeFi as a way to fairly redistribute the wealth on such full display in bankers corporate car parks.

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So far, Patrick says, even though some cryptocurrencies have soared (and plummeted), in value, his hobby hasnt made him rich, Jenny Nicholls writes.

He admits, though, that DeFi is still in its infancy, and thinks cryptocurrency needs more regulation to protect users and guard against criminal activity.

Banks may have been bringing creditors and debtors together since the Banco dei Medici improved ledgers in the 15th century, but Patrick thinks it is time to move on. Many others share this view, and not all of them are crypto bros.

In 2016, the British journalist John Lanchester wrote a long think piece in the London Review of Books called When Bitcoin Grows Up. The simplest and biggest possibilities [for radical change to financial systems], wrote Lanchester, concern connectivity. We are more connected in more ways to more people than we ever have been at any point in human history. This is changing everything, and it would be deeply strange if it didnt change money too.

He points to the billions of people in the developing world who own a phone, but have no bank account.

INA FASSBENDER | AFP | Getty Images

If Id mined Ethereum and banked it Id probably be a few hundred thousand bucks up, says Jenny Nicholls friend Patrick.

If your phone can give you access to the things you would need from a bank, says Lanchester, well, youve just disinvented the need for banks, and fundamentally changed the operation of the money system, across whole swathes of the world.

Cryptocurrency, though, is probably not the answer.

M-Pesa, a Kenyan mobile phone-based money-transfer service, was created about the same as Bitcoin. Unlike Bitcoin, M-Pesa is now popular across much of Africa, handling the kind of mass daily transactions crypto-as-currency maximalists can only dream about.

Sceptics often use M-Pesa to demonstrate cryptos shortcomings: Bitcoins decentralised blockchain, they say, makes mass transactions slow and horribly inefficient, and its volatility means you never know how much it will be worth tomorrow.

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Jenny Nicholls: But even using renewables for crypto mining sucks power away from electric cars and houses and hospitals. Is it all worth it?

Nicholas Weaver, a US cryptocurrency expert who has become one of its most vocal critics, put it this way: M-Pesa is huge. Because it just basically attaches a balance to your phone account. And you can text to somebody else to transfer money that way. And so even with the most basic dumb phone you have easy-to-use electronic money. And this has taken over multiple countries and become a huge primary payment system. [Whereas] the cryptocurrency doesnt work.

Ironically, Patrick, no slouch in the brains department, has designed an app that does much the same thing as M-Pesa. New Zealand banks were not interested.

Forbes magazine recently published a comparison of digital transaction rates. Visa, for instance, can handle around 1700 transactions per second (TPS) compared with Bitcoins 4 TPS. And Visa uses much less energy.

Bitcoin consumes electricity, noted Forbes, at an annual rate exceeding the entire annual electricity consumption of Norway. In fact, Bitcoin uses 707 kilowatt-hours (kWh) of electricity per transaction, which is 11 times that of Ethereum.

For greenies like me, this makes Bitcoin untenable.

Cryptos defenders would dismiss these criticisms, and the ones about rampant money-laundering, as FUD Fear, Uncertainty and Doubt. FUD is cryptos version of fake news. Ethereums planned new algorithm, they say, will drastically improve its carbon footprint.

Most of Patricks mining rig is in Auckland, which gets its power from renewable hydro, wind and geothermal sources. But even using renewables for crypto mining sucks power away from electric cars and houses and hospitals. Is it all worth it?

Journalist Nathan Robinson concluded his interview of arch sceptic Weaver with this summary of his argument: There is no problem that cryptocurrency solves, and to the extent that it is functional, it does things worse than we can already do them with existing electronic payment systems. To the extent it has advantages, the advantage is doing crimes.

The title of the magazine interview was Why This Computer Scientist Says All Cryptocurrency Should Die in a Fire.

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If banks are the problem, cryptocurrency probably isn't the answer - Stuff