1880 S Dairy Ashford Rd, Suite 650, Houston, TX 77077

Why Does Bitcoin Use So Much Energy?

Not many know that bitcoin was created to provide fast, borderless transactions. But today, this cryptocurrency is more of a speculative asset that attracts investors from around the world. Many want to sell bitcoins at a higher price after they go up in value and get a good profit. The main process in this sphere, namely mining cryptocurrencies, is not without a reason. Now you can find any bitcoin mining hosting for your taste and invest in this profitable business.

But of course, this business is not without certain nuances, namely the huge consumption of electricity. It takes 1449 kilowatt-hours (kWh) of energy to mine one bitcoin. This is the same amount that the average American household consumes in about 12 years. Meanwhile, the blockchain technology behind it could be the key to a greener future.

Why Does Bitcoin Consume So Much Energy?

The answer to this question lies mostly in your attitude towards this cryptocurrency. If you believe that bitcoin brings no value other than to serve as a money laundering device, then it makes sense that consuming any amount of energy is wasteful. If, however, you are one of the many who use bitcoin as a tool to achieve their goals then you probably think that energy is very well consumed.

At first glance, it seems that Bitcoin really shouldn’t consume a huge amount of energy. After all, it does not require any complicated functions to buy or sell it. But it is the decentralized structure of Bitcoin that is responsible for the enormous carbon dioxide emissions. Every year the requirements for computing power are growing, because the algorithms are becoming more and more complex.

In the case of Bitcoin, this is made even more complicated by the race in which a large number of miners are involved. After all, the person who solves the problem the fastest will be rewarded. If before this process didn’t require powerful computing abilities, now everything has changed. As we said before, cryptocurrency technology involves increasing the complexity of mathematical tasks. If before, cryptocurrency could be mined using a home computer, now there are even crypto-hostings for this purpose, where there is a huge amount of equipment for bitcoin mining.

This process also takes a huge amount of time: Up to 12 minutes per Bitcoin transaction. This is how long it takes to mine a new block.

But again, everything is learned by comparison, and there are two examples:

  • Every day bitcoin consumes the same amount of energy as 520,000 Canadians.
  • The electricity that bitcoin consumes in a year is enough to power the United States for only 23 hours.

Where Does This Energy Come From ?

Bitcoin in the future will continue to be powered by hard-to-reach sources such as hydro, geothermal, and solar plants. Very few bitcoins are produced by burning coal, oil, and gas because these resources are gradually coming to an end, are easily transported to high-cost locations, and are expensive to mine.

In addition, it could be argued that bitcoin saves electricity. The world’s financial systems require many other resources besides electricity to run the servers.

In light of all this – does bitcoin look like such a big burden on the neck of the world’s energy industry? Given the trend of bitcoin crypto mining toward renewable resources and the fact that the traditional banking system is far from being environmentally friendly, it is possible that cryptocurrency has a positive impact on the environment.

Solving the Bitcoin Problem

While this is not a terrible problem and does not require an immediate solution, bitcoin supporters have several options.

  • Renewable Energy Sources

This will not only help to postpone the issue of bitcoin and energy, but perhaps even close it forever.

  • Proof-of-Stake Systems

Proof of stake requires network members to deposit a small amount of cryptocurrency to participate in a lottery to be able to verify transactions.

Such systems reduce the competitive computational element, “it saves energy and allows each machine in the system to work on one problem at a time, unlike the PoW system.

  • Using Pre-Mining

Implementing such a technique would help avoid useless calculations. Transactions will still be validated by a decentralized network of validators before they are added to the blockchain currency, but transaction participants may have to pay a small transaction fee to compensate for the validators’ efforts.


As we can understand, cryptocurrency mining has become a very popular way to make money, not to mention some bitcoin mining crypto hosting. It’s hard even to imagine the scale of crypto mining because there are hundreds of thousands of devices all over the world. That’s the main answer to why bitcoin consumes so much energy. As with any other energy-consuming industry, the crypto community must recognize and address these environmental issues, work in good faith to reduce bitcoin’s carbon footprint, and ultimately demonstrate that the public value that bitcoin provides is worth the resources required to sustain it.