Bitcoin and energy: they consume more than Switzerland

It is out of the question that the underlying blockchain delegated to cryptocurrencies management is an energy-intensive technology. In nations where mining activities are more intense, a issue was felt mainly: China overall, then Iran, we wrote several times on these websites. They even regarded banning Bitcoins to remedy the situation in Beijing.

Bitcoins and power consumption But how much electricity is required by virtual coins? A lot, a lot. The Bitcoin over Switzerland in particular. To affirm it, a CBECI (Cambridge Bitcoin Electricity Consumption) instrument placed online this week that estimates energy consumption in real time (updated every 30 seconds) and thus calculates the annual one: the decentralized infrastructure on which BTC transactions are recorded absorbs 60.45 TWh every twelve months. At 58.46 TWh, the Swiss nation stops, the Czech Republic reaches 62.34 TWh, 293.5 TWh, Italy.

To comprehend the crypto's huge effect, it's enough to believe it's burning around 0.25% of the global electricity generated. And the reference, we repeat, is to Bitcoin alone, not to other cryptocurrencies such as Ethereum. The chart below demonstrates well the development of the last five years. The yellow line should be taken as a reference (the others represent the peaks): the present 60.45 TWh fell from just over 2 TWh in mid-2014.

Some analysts estimate that the Bitcoin exchange-based blockchain nodes process less than 100 million transactions each year. An infinitesimal amount compared to about 500 billion realities in more traditional finance. So is it lawful to talk about excessive consumption? Yes. And the reasons for this are the very nature of the shared register and the operation of the hardware delegated to mining activities.

Whether development will slow or proceed as seen in the last five years is hard to determine today. The decentralized cryptocurrencies structure makes any effort to rule them by definition almost impossible. The industry may alter (or develop, based on your point of perspective) with the introduction of a project like Libra, lately announced by Facebook and a few dozen associates, aimed at debuting next year with the aim of dealing with a crucial blow to the dynamics that control the economy on a worldwide scale today.