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Energy consumption: Bitcoin mining vs Financial banking system

The boomers switched from; BTC is used for illegal purposes, to; BTC takes way to much energy to mine. Its a global disaster.

What these boomers forget to mention is (probably any argument at all), how does this reflect on the current system;

**BTC Mining energy;**

There arent hard numbers that says how much energy BTC mining consunes and i have a feeling a lot of FUD is been spreading.

Digiconomist.net stats show the BTC network captures 77.78 TWh, while CBECI indicates the network is 111.08 TWh. That is a 44% difference in attempting to estimate the consumption of the crypto asset’s network. Yet, these are the most leveraged sources used by bitcoin naysayers who say BTC’s electrical consumption is a ‘waste’ without any shame.

https://preview.redd.it/aszd7xf5bkk61.jpg?width=1280&format=pjpg&auto=webp&s=5541774f6d4a2bd184e02296b81613411978176f

The lowerbound of CBECI data is annualized on 19 january 2021. Its being said that this is the more accurate data of the network power and this would be **39.32 TWh**

Zodya did a [research](https://medium.com/@zodhyatech/do-bitcoins-consume-more-electricity-than-our-country-3cc354a6c191) in 2017 and found a widely-used formula to calculate the energy consumption of bitcoins.

**This** formula takes total mining revenues as the starting point. Then, it estimates the total operational costs for miners which are taken as a percentage of the miner revenue. The total operating costs which is calculated is converted into energy consumption using average electricity prices.

It is estimated that Bitcoin current annual electricity consumption is **32.56 (TWh**). Since this calculation uses some estimations and assumptions, we cannot be sure of its accuracy. But it does tell you the approximate energy consumption of Bitcoin.

There are [countless rebuttals](https://www.coindesk.com/the-last-word-on-bitcoins-energy-consumption) and [data points](https://twitter.com/danheld/status/1351235131214802945) that show people complaining about Bitcoin’s energy consumption are overreacting.

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https://preview.redd.it/cqr21vc7ikk61.jpg?width=1076&format=pjpg&auto=webp&s=d1753a8639eadb4e028a340ae2e57f981ba9fdc8

**Renewable energy sources**

Its being said that 70% of the crypto miners use a renewable energy source to power facilities. There is also abundant [efforts](https://news.bitcoin.com/genesis-mining-is-converting-excess-bitcoin-datacenter-heat-into-greenhouse-power-in-sweden/) dedicated to [energy cogeneration](https://news.bitcoin.com/south-florida-distillers-bitcoin/) as well.

The 2020 third Global Cryptoasset Benchmarking Study by the University of Cambridge also indicates that 76% of digital currency miners use renewable power sources. Backing up this data is a report from Deutsche Bank Research, the Chinese National Energy Agency, Morgan Stanley, and Coinshares. The report from these four organizations highlights that “78% of Bitcoin’s electricity usage is from renewables.”

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https://preview.redd.it/m0a0sf0jckk61.jpg?width=696&format=pjpg&auto=webp&s=bc8d90f1c8acc6d7954e8ab815e28f773c915cc4

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**Current financial banking system**

The boomers and media mostly forget to mention our current banking system. here is a great number of articles and statistics that indicate the current banking system uses [well over 140 TWh a year](https://medium.com/@zodhyatech/which-consumes-more-power-banks-or-bitcoins-8302750fe2bc). This is assumption [source](https://medium.com/@zodhyatech/which-consumes-more-power-banks-or-bitcoins-8302750fe2bc):

1. **Server costs,**

100 servers per bank, If a server in average consumes 400Wh and since it always on, this means that banks consume in total 800 Mwh.

**2. Branches cost**

According to the World Bank, there are 12.5 branches per 100,000 adults in the world. As the world population is 7.6 billion and we have around 70% adults, this means a total of 665,000 branches. Only in the US, they appear to be close to 100,000 branches and assuming the US is around 15% or less of the entire banking system worldwide you get to around the same number.

Calculating a branch’s consumption turns out to be tricky since there are lots of things to take into account like the size of the branch or number of employees as well as several things consuming electricity like lights, cooling, computers, etc. And they are not open 24 x 365. So after studying some case-studies, I have decided to settle for a conservative number 15 kWh per branch assuming an average branch has 10 light bulbs, two air conditioning units that are used 40% of the time and 12 desktop computers running an average of 12 hours a day, 20 days a month through the year.

**3. ATM Cost**

There are also 3 million ATMs throughout the world. For an ATM with 2 air conditioners and lighting, the average daily power consumption comes around 48 kWh.

So total consumption for banks during a year only on those three metrics is around 26 TWh on servers, 87 TWh on branches and 26TWh on ATMs for a total of close to a **140 TWh a year.**

[source](https://medium.com/@zodhyatech/which-consumes-more-power-banks-or-bitcoins-8302750fe2bc)

**Conclusion**

This would mean that BTC uses 1/4 in comparrison to the current financial system.

Even tho, this past October, the researchers Yo-Der Song and Tomaso Aste, published a report which highlights that the cost of bitcoin mining “has never really increased.” In this [paper](https://www.frontiersin.org/articles/10.3389/fbloc.2020.565497/full). When BTC will be adopted world wide, there will be more transactions.

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**Edit:** I see it became quite bit of a discussion. Good!!! Lets talk about it and learn from it, even if you agree or dissagree.



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