The debate surrounding the energy consumption of proof of work (PoW) cryptocurrencies, such as the Bitcoin (BTC) network, is more alive than ever. Recently, co-founder of Ethereum (ETH)Anthony Donofrio, yet that the Bitcoin network “way too much” energy consumed. However, there is also a lot of ambiguity and misinformation regarding this topic and how much energy does the Bitcoin network actually use?
Bitcoin energy consumption
Quite a few large studies have already been conducted that have examined the energy consumption of various crypto networks. The annoying thing, however, is that the results of these different networks do not always match. For example, a study by Digiconomist that the Bitcoin network consumes about 204 Twh of energy. This would be an astonishing 0.81% of the entire world’s energy needs.
electricity consumption estimates
world: 25,000 TWh
Bitcoin: 204 TWh (0.82% of world)
Ethereum: 85 TWh (0.34% of world)sources: statista and digiconomisthttps://t.co/rPFISs5tdLhttps://t.co/brrTKeiIj5https://t.co/XZ2FBE3mDm
— Justin Ðrake 🦇🔊 (@drakefjustin) June 9, 2022
Another major study of the University of Cambridge however, came to a completely different conclusion. According to this research, the total energy consumption of the Bitcoin network was only 128 TWh. That is still significant, but significantly lower than Digiconomist’s estimate.
In addition, such studies do not include the impact on the climate. For example, about 60% of all Bitcoin miners use completely green energy. That means the Bitcoin network is responsible for just 0.08% of global carbon emissions, it said CoinShares recently in a study†
Proof-of-stake networks and bitcoin
It can be concluded that determining the exact energy consumption of the Bitcoin network is difficult, as is determining the effects of this energy consumption on the climate. Nevertheless, it is a fact that the Bitcoin network consumes large amounts of energy.
According to opponents of proof-of-work networks, such as Bitcoin, this energy consumption is also completely unnecessary. There are alternatives to the mining process, which ensures that astronomical amounts of power are required. One of those alternatives is the so-called proof of stake (PoS) consensus model.
To drastically reduce energy consumption, the Ethereum network will therefore sometime this year switch from PoW to PoS. This will ensure that the 85 TWh of energy (according to Digiconomist) will be reduced to almost nothing.