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Galaxy Digital estimated that Bitcoin’s total annual electricity consumption is 133.89 TWh/yr.
Galaxy Digital has revealed that Bitcoin consumes less energy than the banking system and gold. Galaxy Digital released the report on Bitcoin energy consumption after researching how much energy Bitcoin energy uses. The authors of the report said that “this report took a quantitative approach, comparing Bitcoin’s energy usage to that of other industries.”
Galaxy Digital Research Shows Bitcoin Uses Less Energy Thank Banking and Gold Industries
The report is titled “On Bitcoin’s Energy Consumption: A Quantitative Approach to a Subjective Question.” The report explained how Bitcoin uses less energy compared to traditional financial industries and the gold industry.
Galaxy Digital conducted research on the energy consumption of Bitcoin compared to the gold and banking industries after Tesla Inc (NASDAQ: TSLA) CEO Elon Musk slammed the king coin over energy usage.
At the opening of the report, Galaxy Digital noted that Bitcoin consumes a “substantial amount of energy,” making the network robust and secure. The authors also applauded Bitcoin’s transparency which makes it easy to estimate its energy consumption. On the other hand, companies in the traditional banking system do not publicly disclose their energy footprints.
Furthermore, Galaxy Digital estimated that Bitcoin’s total annual electricity consumption is 133.89 TWh/yr. Galaxy Digital compared the Bitcoin network’s energy with the yearly global energy supply and the global annual electricity generation. As stated in the report, the total global annual energy supply is 113.89 TWh/yr, 1,458.2 times that of the BTC network. Also, the global annual electricity generation is 234.7 times (26,730 TWh/yr) that of the Bitcoin network. In addition, the energy footprint of “always-on” devices across the US is 1,375 TWh/yr. This represents a 12.1 times jump compared to that of Bitcoin.
Report Shows Difficulty in Gauging Energy Use of Gold and Banking Industries
According to the report authors, analyzing the energy consumption of gold and banking industries is difficult. The report revealed that the industries lack data on energy consumption.
Galaxy Digital used The World Gold Council’s report titled “Gold and Climate Change: Current and Future Impacts” to calculate the energy consumption of the gold industry. The report highlighted the total greenhouse gasses emissions (GHG) for the gold industry throughout 2018. The research showed that the majority of GHG comes from upstream processes like mining and refining and not from downstream processes.
The authors noted that direct GHG emissions, indirect electricity emissions, and gold refining and recycling-related emissions were considered during comparison with Bitcoin. Galaxy Digital said the total annual GHG emissions from these segments resulted in 100,408 508 tCO2. While researching, Galaxy Digital then converted the GHG emissions to kWh/yr. In conclusion, the researchers concluded that these elements of the gold industry use about 240.61 TWh/yr.
The report said that it is even more challenging to gauge the energy consumption of the banking industry The report, however, considered banking bank branches, banking data centers, card network data centers, and ATMs energy consumption. In the end, Galaxy Digital estimated 238.92 TWh/year as the banking industry’s banking consumption.