Bitcoin More Energy Efficient Than Current Banking Technologies

in bitcoin •  last month

Bitcoin's energy debate has sparked environmentalists to speak for and against its electricity use


Image source: pixabay - Free-Photos

Just a few months ago Alex de Vries published on Cell - Joule discussing "Bitcoin’s Growing Energy Problem". The article made estimates of Bitcoin's electricity consumption to reach at least 2.55 gigawatts and potentially up to 7.67 gigawatts in the future. We are looking at energy consumption equivalent to the energy use for Ireland (3.1 gigawatts) and Austria (8.2 gigawatts).

Ireland has a 6.5 million human population in 2016, while Austria is home to 8.8 million residents. With an estimated world population of 7.6 billion people, we are looking at energy consumption for 0.1% of the world's population. This puts into perspective the argument about Bitcoin's energy consumption - an efficient system used to operate global blockchain technologies.

As Bitcoin's operating costs comes primarily from electricity consumption, green companies have been making plans to adopt renewable sources of energy to fuel the blockchain. Hydro-energy, wind and solar are renewable energy sources that have been successfully harnessed by today's green technologies.


Image source: pixabay - Pexels

Energy firm, Soluna, has acquired a 37,000-acre wind-farm site in Morocco that could potentially provide 900 megawatts of power. According to technologyreview - Mike Orcutt, wind power could supply cheap electricity to power high-density computing centers. It is unclear if wind power could theoretically cost less than coal power, which costs only $0.03 per kilowatt-hour in China.

Soluna's white paper looks quite promising. Not only do they plan to generate wind energy, plans to help Morocco shift towards greener energy sources is in check. Morocco now aims to produce over 52% of its electricity through green power by 2030.

I am not sure how renewable energy would impact our future other than being environmentally conscious. If there would be less reliance on traditional energy sources such as oil, coal and gas for fuel, countries without these resources could achieve energy independence.


Image source: pixabay - skeeze

Katrina Kelly-Pitou, a research associate from the University of Pittsburgh gave her views on Bitcoin's energy consumption on The Conversation. She has pointed out that new technologies such as data centers are often energy intensive. But over time, they would become more energy efficient and thus saving costs. She brings up another point about energy used in Banking:

"Banking consumes an estimated 100 terrawatts of power annually. If bitcoin technology were to mature by more than 100 times its current market size, it would still equal only 2 percent of all energy consumption."
Source: The Conversation

The discussion on Bitcoin's high energy efficiency than the banking systems could indicate cost savings for countries planning to shift toward blockchain technologies. Reduced manpower and electricity costs could help countries move forward in economic growth. Banks today act as the middleman which takes up unnecessary costs.

There are approximately 30,000 banks in the world, each one with servers, branch offices, and ATMs. Adding together all of these factors, we get approximately 100 or so terawatts of power consumed by banks each year. Clearly, this pales in comparison to the 25-30 terawatts Bitcoin consumes.
Source: bitsonline - Robert DeVoe

This is quite a refreshing take on "Bitcoin's Growing Energy Problem" because the main issue that we are clearly not tackling today is: "Banking's Growing Energy Problem".

-tysler

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the cheapest and eco-friendly option are the renewable energy, I loved your article followed

Nice point of view. The todays technology is not efficient at all. Bitcoin and other mining currencies will get a lot more effiient over time. The innovation is huge in this space

Never took the energy consumption seriously but I still love these articles.

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@feelsomoon, thanks for supporting :)