Bitcoin Energy Consumption Debates once Again Sparking Controversy in the Crypto Circles

Bitcoin has become the fastest growing and top-ranked cryptocurrency in the world. At the moment, the flagship cryptocurrency has a market cap of $1 trillion, leaving behind names like Facebook, Apple Inc., and Microsoft. Both retail and institutional investors are taking a keen interest in Bitcoin due to its high returns and quick appreciation. There is also a flip side to the story putting Bitcoin under critical diagnosis for its heavy-set energy consumption.

The data issued by Finbold compares the real results with concerned parties. There had been unsubstantiated results from investors who had attached big numbers with the Bitcoin energy consumption in the past. This data has been compiled by Cambridge Center of Alternative Finance, Visual Capitalist, and Statista. The data shows the annual electricity usage index in Terawatt-hour (TWh). As per the charts, Bitcoin consumes 143 TWh. This number is 45 times lower than China and 27 times lower than the United States. However, tech giants like Google only take up about 17 TWh while Facebook takes up about 5 TWh.

Is Bitcoin Miners Setting off a Power Drought in the World?

According to Michael Saylor, Bitcoin miners use the amount of energy that is lost or misused every year. However, his word can be tainted with bias, as Saylor self-identifies as an avid Bitcoin investor and advocate. At the pretext, Bitcoin power consumption debates have been a point of contention for many years. After the remarks of the US Treasury Secretary, Janet Yellen, regarding the enormous carbon footprint that Bitcoin mining farms generate, the Pandora box has opened once again.

The increase in demand also prompts miners to dig up more Bitcoin, and as a result, the energy consumption requirements are also increased. Another theory pertains that when more transactions are added to the blockchain, the computers need more power to solve the cryptic puzzles that keep getting more complicated as they move forward. Many crypto proponents think that massive energy consumptions are fair compensation for the leading coin’s monetary benefits.

Is it a Good Idea to Promote Renewable Power Projects through Bitcoin?

Twitter and Square Inc. CEO, Jack Dorsey, has been in support of a green technological evolution for Bitcoin. He has been advocating for promoting renewable energy resources to ride on Bitcoin. According to him, it would be possible to create mines that are entirely powered by renewable energy resources, and such projects could still export the excess energy to cities and industries. Dorsey has also dedicated 10 million to Bitcoin Clean Energy Investment Initiative. 

On the other hand, due to the open-source nature of the blockchain, developers are trying to come up with upgrades and protocols that can be implemented to make the transaction shift less energy-hungry and more sustainable. Meanwhile, better mining hardware like application-specific Integrated chips (ASICs) and purpose-built chips would be able to make the mining process more energy efficient.