A recent report has shown that the energy consumption of the Bitcoin network is 50 times less than that of regular banks. According to a research report released by Valuechain, the energy consumed by the Bitcoin network was out to test, it was calculated and then compared with the energy consumed by other industries. This new research dismisses the most frequent research work which comes from the University of Cambridge, bashing Bitcoin’s power use. What some of these misleading reports however fail to mention is that the same argument could be applied to the servers used by the banking system, as the transition would require more time, effort and energy consumption.
Prior to the new report, data analyzed by the University of Cambridge suggest that the annual energy consumption of the Bitcoin network was equivalent to about 121 terawatt-hours (TWh) ranking it in the top 30 electricity consumers worldwide. The research widely portrayed the Bitcoin blockchain as a hoggish energy glutton that’s stomping all over ecological ideals with its massive carbon footprint. In fact, the Cambridge data suggested the idea that if Bitcoin were a country, it would be sucking down more energy than either the Netherlands or Pakistan. In other words, Cambridge data said that these countries require less energy than the entire BTC network. To get a deeper idea of how much energy we are talking about here, the WorldCounts website stated that a single terawatt has the ability to power up at least 10 billion, 100-watt bulbs at the same time. The most interesting part of these researches is that the power panning against Bitcoin isn’t just from theoretical academicians, many leaders within the crypto community itself also accepted and sponsored this school of thought.
In a recent media article, last month precisely, Cardano co-founder Charles Hoskinson stated that “Bitcoin’s energy consumption has more than quadrupled since the beginning of its last peak in 2017. Hoskinson insinuated that chances are that it will get worse because energy inefficiency is built into Bitcoin’s DNA. Bitcoin’s carbon footprint will get exponentially worse because the more its price rises, the more competition there is for the currency and thus the more energy it consumes.”
While it’s easy to state all sorts about the first and most valuable cryptocurrency – Bitcoin, especially due to its currently unstable nature that has shown a fall by a significant percentage across cryptocurrency exchanges. The new research report released by Valuechain questions every environmental-focused claimthat has been put forward to date against Bitcoin. In a 27-page white paper titled “Bitcoin: Cryptopaments Energy Efficiency” published by the payment consultancy firm Valuechain after conducting four years’ worth of research and data compilation. The Valuechain publication has now disclosed that past energy analyses of Bitcoin especially the one from the University of Cambridge research contained incomplete, inaccurate, and unfairly biased facts against crypto. For example, Valuechain specifically questioned a paper titled “The Carbon Footprint of Bitcoin” by the central bank for cherry-picking debit card use — which is a small element within traditional banking — as the isolated comparator against Bitcoin’s entire ecosystem.
According to the publication, it stated that “It’s essential to compare Bitcoin energy consumption with all the aspects of the classical monetary payment system. This covers banknotes and coins cash management in ATM systems, card payments, point of sale (POS) payments, banking and inter-banking energy consumption, etc. We’ve endeavoured in our paper to answer mathematically and scientifically all these challenges for the benefit of decision-makers, researchers, politicians, legislators and industry representatives.”
Valuechain’s four-year study on the subject went further to calculate the average lifespan of Bitcoin mining rigs; the surge in the use of hydro, wind, and solar power by BTC miners; and miners’ adoption of energy-stingy mining tech to determine that Bitcoin’s global network annually consumes 88.95 terawatt-hours. Compared to Cambridge’s estimate of about 121 terawatt-hours annually, it’s safe to say that’s almost about 50% less Cambridge’s claim. Valuechain also went ahead with the assessment of the traditional banking system, the discovery using “physics, information science and economics” to compute, compare, and define an accurate energy use revealed a really shocking annual energy use profile of 4,981 TWh, a figure nowhere within the league of Bitcoin’s 89 TWh.
According to the Valuechain paper, “We demonstrate that Bitcoin consumes 56 times less energy than the classical system and that even at the single transaction level, a PoW transaction proves to be 1 to 5 times more energy efficient. When [the] Bitcoin Lightning layer is compared to [the] Instant Payment scheme, Bitcoin gains exponentially in scalability and efficiency, proving to be up to a million times more energy efficient per transaction than Instant Payments,” The new data put forward by Valuechain has revealed that the use of blockchain is effectively green and fully attentive to the issue of sustainability. This data is reliable and going forward, should generally erase every anti-BTC sustainability biases that has clouded our perception, while also bolstering Bitcoin’s reputation as a “net good” in pursuit of net-zero emissions.
Olagoke Ajibola is a creative writer and content producer with an eye for details and excellence. He has a demonstrated history of telling stories for TV, Film and Online. Aside from being fascinated by the power of imagination, his other interest are travel, sport, reading and meeting people.
