Bitcoin is an energy consuming monster

Bitcoin/Illustration

Cryptocurrencies, and more particularly Bitcoin, are much talked about in recent months, because of the volatility of their prices. Mid-December 2017, Bitcoin has even reached a historic peak, exceeding $ 20,000 before diving back and stabilize currently around $ 10,000.
Cryptocurrencies are on the rise, attracting more and more investors… but also consume more and more energy, by its immaterial and decentralized nature.

Using secure blockchain technology, Bitcoin requires phenomenal cryptographic computational power, with a large network of computers involved in the transaction chain.

What is the power consumption of this decentralized transaction system? Digiconomist claims to have the answer. Currently, the power consumption of Bitcoin is estimated at 51.09 TWh. That’s 51 million kWh. This represents 61% of Belgium’s electricity consumption in 2016 and 0.23% of world consumption. Compared with current banking systems, a Bitcoin transaction consumes as much as 450,000 visa transactions.

In ecological terms, Digiconomist evaluates the carbon footprint of a Bitcoin transaction at 374kg. It’s like flying between Brussels and Berlin.

If the method of calculation is based on certain basic assumptions that are criticized by some economists*, as explained on the Digiconomist page, these vertiginous figures show the extremely energy-consuming nature of the new technologie. Digiconomist encourages stakeholders to reflect on the ecological impact of bitcoin especially as our natural resources are just running out.

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Other agencies also have their evaluation of bitcoin’s energy consumption. They evaluate the annual power consumption of Bitcoin at 18TWh (Marc Bevand), or 40TWh (Morgan Stanley), consumptions in any case much higher than banking transactions.

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Carl Frantz

Polyglot, humanitarian, Carl was born in Germany but raised in the USA. He writes mostly on tech, science and culture.