- Recent data shows that Bitcoin mining consumes only 0.16 percent of the total electricity consumed by the world every year.
- A Bitcoin developer explains that ten years from now, the Bitcoin subsidy on mining won’t be enough to consume even 1 percent of the world’s energy.
Bitcoin energy consumption has been the topic of debate for quite some years now. Recently, the European Central Bank (ECB) talked in detail about Bitcoin’s energy consumption. It also compared the Proof-of-Work (PoW) protocol to fossil fuel cars.
While Bitcoin continues to get the heat for its energy consumption, a developer puts a fresh light on the matter. Sjors Provoost, a Bitcoin developer and author of “Bitcoin: A Work in Progress,” talked about BTC’s future energy use. He noted that for Bitcoin to consume 100x the current energy, the BTC price has to reach $20 million.
Bitcoin’s energy consumption has been a topic of debate all across the world. Bitcoin’s high energy consumption was the reason that China banned Bitcoin mining last year in 2021. However, Bitcoin proponents argue that the lack of understanding of BTC’s network principles and bias has led to critics making incorrect conclusions about Bitcoin’s energy use.
Bitcoin developer Matt Odell recently published a graphic showing that Bitcoin consumes 0.49 percent of the world’s wasted electricity. This is also just 0.16 percent of the overall electricity consumed across the globe. Sjors Provoost provided some insights that the energy use of BTC would increase proportionately along with the Bitcoin network’s pre-programmed changes. The Bitcoin developer also expressed surprise at his calculated outcomes. Provoost wrote:
In 10 years the block subsidy will be ~10x lower (3 halvings). In order to get 100x today’s energy use, Bitcoin would have to trade at $20M by then (plus energy cost inflation adjustment). But a $420T market cap is absurd, more than ALL real estate.
In 10 years the block subsidy will be ~10x lower (3 halvings). In order to get 100x today’s energy use, Bitcoin would have to trade at $20M by then (plus energy cost inflation adjustment).
But a $420T market cap is absurd, more than ALL real estate: https://t.co/3L8npaR8V7
— Sjors Provoost (@provoost) July 18, 2022
Keeping Bitcoin’s Energy Use in Check
The Bitcoin blockchain network undergoes a halving every four years. This cuts the block subsidy to half i.e. the number of new Bitcoins added to the supply per mined block. This happens to the pre-configured Bitcoin Proof-of-Work (PoW) mining algorithm.
Thus, miners have to deploy more hardware to maintain network security. More mining hardware results in greater power consumption thereby resulting in small rewards. But BTC developer Sjors Provoost believes that efficient mining hardware and revenue earned through transaction fees for miners shall keep energy use in check. Sjors noted:
Another 12 years later and even if Bitcoin is worth more than all the worlds real estate, the mining subsidy would not be enough for Bitcoin to use more than 1% of global energy. So if nothing weird happens before 2030, it can probably keep running on waste energy breadcrumbs.
However, Sjors has put a disclaimer that his calculations aren’t verified. Over the last year, a large part of Bitcoin mining activities has shifted to the use of renewable energy. The Bitcoin Mining Council, involves some top companies joining hands and working to shift BTC mining to green energy.
Related: Jack Dorsey, Michael Saylor in a letter to EPA: Here’s what Congress got wrong about Bitcoin mining
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