Bitcoin Energy Consumption Is Exploding – BTC Mining Ban?

 The electricity consumption of Bitcoin has been more and more talked about in recent months in the face of the global energy crisis, a context in which the particularly energy-intensive nature of cryptocurrency is a task...

And not the statistics unveiled yesterday will help mitigate the criticism of BTC.

Bitcoin energy consumption explodes in Q3.

Indeed, according to a report by the Bitcoin Mining Council (BMC), which brings together 51 of the largest Bitcoin mining companies in the world, the energy consumption of the BTC network jumped by 41% in annual data in the third quarter of 2022.

The report states that Bitcoin mining would consume 0.16% of global energy production. By comparison, this represents a little less than the energy used by video games, a level of consumption deemed "inconsequential" by the report.

The BMC also calculated that bitcoin mining is responsible for 0.10% of global greenhouse gas emissions, which the report calls "negligible."

Why is Bitcoin's energy consumption skyrocketing?

Note that the rise in Bitcoin energy consumption in the third quarter is primarily explained by the increase of the hash rate, which jumped 73% year-on-year in Q3.

Knowing that the hash rate measures the number of calculations that can be performed per second, means that computer systems dedicated to Bitcoin mining perform more operations and therefore consume more energy.

However, the fact that the hash rate increased much more than Bitcoin's energy consumption in Q3 suggests that mining efficiency is rising.

Incidentally, observations from blockchain data analytics company Glassnode back up this analysis, stating that "the increase in hashrate is due to more efficient mining hardware coming online and/or miners with higher balance sheets having a larger share of the hash power network. »

Nevertheless, even if efficiency increases, public opinion and political power will mainly retain that Bitcoin consumes more and more energy, which could intensify the pressure on Bitcoin mining.

Towards a BTC mining ban?

Recall that last month, the White House issued a report pointing the finger at proof-of-work cryptocurrencies such as Bitcoin and considered a possible ban if the crypto does not improve its energy consumption and/or emissions. Carbon.

Note that instead of proposing to ban Bitcoin, some are considering that Bitcoin will follow the path of Ethereum and transition to proof of stake.

In this regard, it should be noted that the environmental association Greenpeace is currently leading a campaign entitled "Change the code, not the climate," which calls for the Bitcoin network to switch to proof of stake.

It is also important to note that just yesterday, the European Commission published documents describing an action plan which, among other things, plans to closely monitor bitcoin mining activities and their environmental effects.

The plan comes after the European Union rejected a proposal that could have led to a total ban on cryptocurrency mining in March. However, if Bitcoin continues to consume more energy than some countries, authorities could end up cracking down.