Bitcoin Forum

Many articles are reporting the study of the energy consumption of mining and of a single bitcoin transaction (seems 250 kWh per tx)

This data could be almost accurate, as in the bitcoin ecosystem there are just miners as a significant energy expense.


Now, cutting out all the forms of easy-chargeback payment systems (cards, paypal, etc...), and keeping the most similar payment method, wire transfers (independently auditable, trackable, at least not so easy to reverse): is already available an approximation of how much the whole banking system consumes?

Here's one (very) rough estimation that I know of:

https://hackernoon.com/the-bitcoin-vs-visa-electricity-consumption-fallacy-8cf194987a50

I don't think there are actual studies on the matter. Banking is considered a necessity after all, so it's not viewed under a microscope like Bitcoin is.

Thanks for the input. Clearly the bank system including VISA has a lot more transactions to process that bitcoin now. But grossing out just the wire transfers part imho bitcoin is way more efficient than banks.

It is true that bitcoin mining uses and requires a lot of electrical energy, but when compared with other mining such as gold mines, oil, and other bitcoins spend less, especially with banks that always need a lot of energy.

It's not the easiest calculation, since legacy banking isn't just using electricity.  Is isn't just the computers, the ATMs, the branch lights, etc.  There are also the armoured vans that move the larger sums of cash, the fossil fuel they consume, the environmental costs of producing those vehicles to begin with.  Then also the mints that produce all the coins, the mining that has to be done to harvest those metals, the fuel that uses, the environmental impact of producing all the equipment that entails.  Now that we seem to be trending towards polymer banknotes, there are almost certainly industrial manufacturing costs, not to mention the drilling for oil that makes most plastics and polymers possible to begin with.

Electricity usage is far from being the only consideration.  Even if you added the environmental costs for producing all the computers and mining chips around the world that support what we're doing here in cryptoland, I'm pretty sure fiat still has the larger overall impact on the health of the planet.

There's always innovation to do mining using renewable energy sources. such as using turbines and solar energy.
this becomes an important part of increasing renewable energy sources while utilizing them for bitcoin mining.

Mining hardware are being more efficient everyday so power consumption gonna lower down in future also most of the mining operations are set on places with cheap electricity which mean those places has more than enough energy which can be used for anything. Governments are also getting paid by mining companies so it is also helping countries economy, solar power, hydropower and wind power are renewable energy sources so high energy uses might not make any difference on environment at all.

On top of that I can add that as the banking system depends on people (a lot of them, that needs a salary, in many mission critical aspects even a fail-safe team made of many people with the same role), it will be always inefficient compared to computer-only systems such as blockchains.