 Let me quickly start. The idea was also to get away with Daniel Wingen, who is one of the organizers of this conference to analyze the way Bitcoin consumes energy. We already know that Bitcoin is not that bad as people say. So we all already know that consumption is partly done by sustainability here, energies. That's basically sustainable energies, wind energy and so on. And the idea now is that we want to go much more into detail here what happens in case of the hashrate is changing and so on, that's basically the goal of this research. And therefore let me quickly jump into these slides for a couple of minutes. And then I think it's best to discuss them in more detail. So we have also formulated this article here. We call it the green Bitcoin theory, how are Bitcoin electricity consumption and especially green energy are related. Well, my name is Philippe Sandner. I myself am head of the Frankfurt School Blockchain Center in Germany. We have the Blockchain Center three and a half years ago and we focus on everything related to Blockchain and finance. That's Bitcoin, yes, but that's also Ethereum. And that's also, for example, digital currencies, also including the euro, for example, on ledger, especially in Germany, the top of digital euro on ledger pops up more and more these days. But that's not the topic for today. So I think I do not need to show the introductory slide. I think this is very, very much. That is a very nice slide for introduction. There is Bitcoin in comparison to other assets. And here you see, for example, Bitcoin having a market capitalization of 190 billion that was last year and stock markets being 75 trillion that was also last year and gold being 8 trillion. Last year, that's now being 9 trillion. And here the interesting thing is the question where to compare Bitcoin with, I think we all know that a very good comparison might be gold. And then you can now do the math and you divide 187 by 8 trillion. And then you end up by a share of 1.5% of Bitcoin's capitalization comparison to gold. I think that's the comparison that matters. And the question is 5%. Is it fair? Is it too low? Is it too high? And so on. But I think it makes much more sense to compare Bitcoin to gold as a commodity. But I think this is known by everybody. I will jump over this. That's basically related. But now we are going into the core of the topic. So I think everybody in the room knows the basics of mining. Mining has a very long-term weaker effect on the Bitcoin price. That's also in comparison to the stock to flow theory. I think this is pretty clear to everybody. And then Bitcoin has a very strong short-term effect on mining. So in case the Bitcoin price is changing or in terms in times where we have mining, then the mining intensity, the mining volume quickly changes overnight. And the question is always how these circles are changing over time because you have this short-term effect from right to left and the long-term effect from left to right. So this is now the introduction to our theory, which we are outlining. And here you see that, of course, the architecture of the Bitcoin network is basically embodied in the Bitcoin code. This then allows Bitcoin mining companies to operate. The mining hardware consumes electricity. I think this is trivial. And this is to mention some figures here. In January, it has been 10,000 nodes and 116 quintillions of hashes per second. This leads to a very high energy consumption, which is basically not good. I think that's the media narrative we all know. But the question, and now I think it gets interesting, is more or less the question, which energy is actually consumed? What is motivating mining companies actually to operate? And what energy sources are allowing low cost of electricity because now you can connect the dots. And this means 73% of energy is coming from renewables, according to this study mentioned here. Then mining companies only continue to operate if there is access to low cost electricity. And the question is, which energy sources are providing access to low cost energy? And here you see mainly hydropower, wind power, which allows an electricity price of two to three euros per kilowatt hour. Whereas with secondary priority, you can also of course have coal and gas power plants which are producing electricity with five to six euros per kilowatt hours. One of the authors of this study has been Andreas Straub. He's also from Germany. He works at an energy utilities company for years and investigates mining also on behalf of the energy utilities company. And the figures and the electricity know how it's also coming from him. So we really validated what's going on here. And if you connect the dots, then you see here that in case mining companies aim for low cost energies, then they at some point of time have to choose, for example, hydropower, wind energy, because only these energy sources are providing a low cost electricity price of two to three euros per kilowatt hour. And this then leads to this share of 33, 73% of renewables with now our hypothesis that it will be increasing. And now I think we are going into the detail and I think now it's getting really interesting. So what you see here is that you have on the X-axis the efficiency of mining companies. So this means you have low efficient mining companies on the right hand side. That's basically those mining companies operating with old hardware. They have access just to high cost electricity. That's for example, conventional energy sources such as Golan cars. And on the left hand side, you have mining companies which are highly efficient that they have the latest generation mining hardware in place. They have access to low cost electricity and they have, for example, access to excess energy which is not needed in the electricity grid or renewables. So what we see here, and this is very important is that we have some kind of distribution here concerning the efficiency grade of mining companies. Some of them are very efficient. They are left. Some of them are not so much efficient. They are on the right hand side. And of course, the lion's share of the mining companies due to statistical reasons somewhere in the middle having this kind of bell-shaft curve. And this is then reflecting the population of all mining companies having different efficiency profiles. And interestingly, because production of Bitcoin only requires, or mainly requires electricity and hardware, we can also mention that here that on the excess, the efficiency being depicted here, it's also the production price of one Bitcoin. So ideally in a theoretical environment, we see that the efficiency is strongly related to the production price of the Bitcoin. This means of one bit that those companies which are operating at a high efficiency, they are on the left hand side, they should then be having a more higher margin, profit margin when they produce Bitcoin in comparison to those mining companies which have a very low efficiency. That's exactly the same like a gold mine. On the X-axis, you would depict the gold price and then you have low efficient gold mines and you have high efficient gold mines. And of course, those gold mines which are highly efficient, they have a higher profit margin, such that for them it's more fun to operate. So now let's see that the Bitcoin price is 9,000 US dollar. That's basically here. And what happens now is that the mining company sitting here on this bell-shaped curve with this blue dot, you can now see that this mining company is profit margin per Bitcoin. For example, 850, 8,500 US dollar is basically the cost for this mining company when they produce one Bitcoin. So the profit margin is 500 US dollar, for example. That's just some numbers here, but it does make sense. So this mining company will continue to operate mining because for this company it's fun because they are having, of course, a profit. For this mining company on the left-hand side, it's even more fun to operate because they have a very, very high efficiency profile. So for them the profit margin is much, much, much higher. So now what happens if the Bitcoin price, for example, is decreasing or alternatively, it's the same mechanism if Bitcoin halving occurs. Then for example, or but let's stick with the example that the Bitcoin price is decreasing to 8,500 US dollars. Then suddenly this mining company, which is sitting here, has a higher production cost for producing the Bitcoin. So it's operating at a loss. So there is a loss for each Bitcoin being produced. The Bitcoin is produced at, say, 8,600 US dollar. It can sell it for 8,500, so there is a loss. So this mining company at some point of time will stop operating because why should it produce Bitcoin at a higher price than it could sell it on the market. Whereas this mining company on the left-hand side, it still operates because it's more efficient. So the profit margin is still there and therefore this company on the left-hand side continues to operate. But what you should keep in mind here is that once the Bitcoin price decreases or once that's more important, Bitcoin halving occurs, then those mining companies are driven out of business which are on the right-hand side. That's those companies who are running on old mining hardware. That's those companies who are having access to high cost electricity or who have access to conventional energy sources such as golden cars. They are just less efficient and therefore a lower Bitcoin price or a lower block reward appearing after halving will lead to the fact that they will simply be driven out of business. But those mining companies which are more highly efficient on the left-hand side, they will stay in the business because they have a better efficiency profile which is rooted in the latest generation mining hardware, low-cost electricity and so on. I think this study can be known by some of the listeners. You see here that in total the share of renewables which are used for mining is 73%. That's basically sitting here on the lowest line on the second column from the right-hand side. That's basically a very, very interesting study where they analyzed how much energy is used for mining and also which energy resources are used such that the Bitcoin mining network can operate. So you have here an aggregate total of 73% of the entire network which is running on renewable energies for mining according to their studies of course which can be disputed but that's at least like the starting point from our further argumentation also 73% of the energy which is being consumed is not coming from coal and gas but rather from renewables. And now there's coming the final logic here of our paper which is a theory. It's not proven, it's not empirically analyzed but it's a theory which can then be analyzed exposed after time has passed. So you see this value chain here. You have engineering companies on the left-hand side they are producing equipment such that electricity can actually be serviced to those who want to consume electricity. Then you see the energy suppliers that's basically the utilities companies they are operating power plants and they are servicing the kilowatt hour electricity for example to Bitcoin mining companies here more on the right-hand side and the Bitcoin mining companies of course they are jointly operating the Bitcoin network but that's basically the value chain which can be observed here. And now that's basically the core of our theory. You have now the Bitcoin network where the hash power is increasing. So the hash power is increasing because new entrant are coming into the mining business because mining hardware is being improved or because happening is being taken place that's basically not increasing the hash power but it's basically reducing the block reward and it has the same effect. We could just change the words here. So the required efficiency to continue mining needs to be improved here. So in case the hash power is increased because we have new entrants or because the mining hardware has improved then the profitability of the Bitcoin mining companies goes down. So you have competitive pressure on mining companies because the hash power is increasing. This leads to the fact that you have two strategies here on behalf of the Bitcoin mining company the mining company can either choose to invest this means they are purchasing new hardware they are purchasing cheaper electricity because they are then doing investment in more in better energy resources which are having a better efficiency profile or alternatively that's on the lower half here they will decide to stop operations. This is of course also a valid business strategy. So once again, you have hash power increasing you have then second profitability decreasing because of competitive pressure then you have the investment increasing by the companies because a company operating in mining seeks to get access to lower cost energy or it invests into a better hardware to leverage the energy in a more efficient way that's the upper argument or the lower argument is that a company in case it does not want to invest simply stops operating and goes out of the Bitcoin network but this higher investment then leads energy suppliers to increase their R&D spendings because an energy supplier would then have an incentive to produce high lower cost energy they are increasing the access to low cost energy they are starting to utilizing renewables they are starting to utilizing depreciated power plants they are starting to improving their equipment because then you're investing R&D to increase the efficiency of energy production that's happening at the stage of the energy suppliers and then you see this now just with one small error in comparison to three on the right hand side you also see or you also should observe a smaller effect on behalf of the engineering companies which also should invest a little bit more in R&D because they now have an incentive to improve cooling generators, turbines and energy producing facilities and other equipment so because the Bitcoin network increases the hash power downstream you have upstream and higher R&D activity on the level of energy suppliers and engineering companies that's the theory that we are having and we are still quite much convinced that it should work like this but of course this needs to be empirically checked in the future but you see here and that's basically then the key message here that the Bitcoin network at some point of time if in case hash rate is increasing in case it's importance is increasing should have a positive impact on R&D spendings at these two stages of the value chain on the left hand side and but we also did some we are back on the envelope estimations and we already know that this is not occurring right now but it might occur once the Bitcoin market cap is increasing such that basically the levels which are being in place here like the volume of R&D spending and so on that they will then show larger figures so as that it's not proven yet it's just a theory but ultimately this movement of an increased hash rate towards higher R&D spendings could lead to the fact that money is being spent for a higher efficiency electricity equipment or utilities plus and that's more important the entire mechanism of efficiency profiles of mining companies should lead to at some point of time to the fact that more mining companies are driven out of the market who are relying on conventional energies and the share of those mining companies operating with high efficiency with sustainable energy resources should increase