The attacks against Bitcoin mining have been from multiple fronts, but few dare to make a comparison with other sectors. In other words, when cryptocurrency mining is criticized for its high electricity consumption, is it high consumption compared to what?
In this sense, the most recent report from Galaxy Digital Mining, that other sectors consume much more energy than digital mining. The criticism against the generation of cryptocurrencies is that it is transparent when it comes to auditing. On the other hand, the international banking system and gold mining offer few clues.
Thus, it can be concluded that Bitcoin is not “the villain of the movie.” On the contrary, other sectors such as those mentioned above, are potential polluting sources that dwarf the impact of Bitcoin at the moment they are compared.
Can you make comparisons between Bitcoin mining and other sectors?
As highlighted above, the energy consumption of Bitcoin mining compared to other sectors, becomes miniscule. Despite this, it cannot be denied that the consumption of digital mining activity is of great proportions. The important thing to highlight is that, for example, the banking system consumes many times more energy than Bitcoin.
In this way, the aforementioned Galaxy report shows with intense research that Bitcoin consumes less than half the energy of both sectors. The math, as always, seems to be blunt. While the energy consumption of Bitcoin mining is 113.89 terawatts per hour per year, that of the banking industry is 263.72 TWh per year.
For its part, the gold mining business consumes approximately 240.61 TWh per year. In this way, it is clear that Bitcoin mining, compared to these traditional industries, lags behind in terms of consumption. It should be noted that the consumption of the gold industry, for example, was calculated with conservative data based on the emission of greenhouse gases.
Other consumptions that decrease the role of BTC
Although Bitcoin mining is the target of attacks based on the electricity consumption it requires to operate, it is important to take a look at some comparisons. This list, the aforementioned report explains, can help put the discussion in context:
- The annual global supply of energy is 166,071 TWh per year. That is, 1,458.2 times what the Bitcoin network occupies.
- The annual global generation of electricity is 26,730 TWh per year. This equates to 234.7 times what the Bitcoin network uses.
- The amount of energy lost each year in energy transmission and distribution is 2,205 TWh per year. In quantity, it is equivalent to 19.4 times the consumption of the Bitcoin network.
- The energy wasted each year by unused but connected electrical devices in the United States is 1,375 TWh per year. This is 12.1 times the consumption of the entire Bitcoin network.
As you can see, those who attack Bitcoin mining for consuming a lot of energy have more serious reasons to worry. It would be out of place to think of Elon Musk writing harsh tweets about plugged-in and out-of-use appliances in America. Although it may seem like a joke, you have 12.1 more reasons to do so than with Bitcoin.
Surplus energy used productively
Beyond comparisons with other sectors, criticism against Bitcoin mining also revolves around an alleged waste of energy. Thus, according to this narrative, the electricity used in the generation of bitcoins could be used for other, more productive purposes.
It is a vision that does not correspond to reality. It should be noted that miners are looking for places with cheap energy. In this sense, those regions with large energy surpluses are the only ones capable of offering low supply costs.
The most notorious example is the province of Sichuan in China, a region where a large percentage of the existing farms in the Asian country are concentrated. There, during the winter, the flooding of the sources produces large surpluses of energy, which, if not used, is wasted. Therefore, the authorities of the region, lower prices to attract miners.
Similar phenomena can be found in various places on the planet. In such a way it can be said that Bitcoin mining is not an anomaly, but a new technology that, like any other, requires energy.