An optimist says the glass is half full. A pessimist says the glass if half empty. And a Vox writer says if you drink 60 glasses of that stuff in the next hour, it’ll kill you.
A case in point is the recent Vox column by Umair Irfan, warning that the Bitcoin network has caused a huge surge in energy consumption. And yet, Irfan’s own article admits that even the largest estimate—which could be double the actual figure—suggests Bitcoin only uses about 0.14 percent of global electricity. It seems somewhat unfair to single out Bitcoin and ignore the other 99.86 percent of the activities that use electricity.
Snark aside, Bitcoin admittedly does use a surprising amount of electricity. Although the estimates are uncertain, Irfan quotes figures suggesting that (in early December) it took some 250 kilowatt-hours of energy to process a single transaction. (For a frame of reference, that’s enough energy to support a typical U.S. household for eight days.) Other statistics show that—assuming the figures on Bitcoin’s usage are correct—the network consumes more electricity than the country of Serbia, and the electricity used to run the Bitcoin network is enough to provide for almost 3 million U.S. households.
Yet how meaningful are these types of stats? Wikipedia reports that in June 2015, the website Vox.com had 54 million unique visitors. If those people had spent their time volunteering, rather than reading Vox, can you imagine how much litter could have been picked up? How many trees planted? How many stories could have been read to children?
When the price of Bitcoin surges—as it was doing when the Vox story ran, though as of this writing it is crashing once again—it ramps up electricity usage. By design, a new “block” (which is 1MB in size) gets added to the “blockchain”—which is the public ledger recording all Bitcoin transactions going back to the launch in 2009—every ten minutes. If the Bitcoin price is high enough to entice more people to enter the industry with their computers to “mine” bitcoins, then the protocol automatically adjusts the difficulty of the computational problems necessary in order to “solve” a new block and be rewarded bitcoins accordingly. (For more information on how Bitcoin and “mining” works, see the free guide I co-authored.)
