$BTC Bitcoin and Climate Change

The creation of bitcoin represented for some the future of currency in a digital world, although there is a profound debate about its role, utility, value, and/or its ability to replace fiat currency.

The creation of bitcoin represented for some the future of currency in a digital world, although there is a profound debate about its role, utility, value, and/or its ability to replace fiat currency. But few have stopped to think about the ecological footprint of bitcoin and other cryptocurrencies. And it is enormous.

Key Points

The process of "mining" each bitcoin requires solving increasingly complex mathematical problems. For this, a large – and ever-increasing – computing power is needed.

The energy consumption of bitcoin "mines" is increasing. Depending on estimates, it is currently between 15 and 31 terawatt-hours annually.

If its value continues to rise, energy consumption will continue to grow, regardless of improvements in mining process efficiency.

The consequences for the electrical grid, energy transition, and decarbonization are profound.