This article is a collection of resources on Bitcoin mining and energy metrics. I keep updating it with the latest figures.
Bitcoin mining uses electricity for secured timestamping
Security means preventing past blocks from being modified so that the sequence of transactions remains written in stone.
The difficulty to mine a block tends to increase on average with the bitcoin market capitalisation because a higher bitcoin price means more mining operations become profitable. When more miners join the collective hashing power then the code automatically increases the difficulty of the algorithm so that the pace of issuance of new blocks remains constant (1 block every 10 min on average).
It kind of makes sense that security increases with market cap: the more gold is in the vault, the larger the walls.
Another factor influencing energy usage is the efficiency of ASICs in terms of how many hashes can be produced per unit of energy. This tends to go up as newer equipment is rolled out.
Note that energy usage does not depend on the number of transactions processed by the network.
So how much energy does Bitcoin mining actually use?
348 TWh
Energy used by Bitcoin mining
167788 TWh
Total amount of energy produced around the world
0.21%
Share of global energy production used by Bitcoin mining
Source: slides presented during the Bitcoin Mining Council H1 2023 briefing. The video of the presentation is available here.
BMC’s estimates of Bitcoin energy usage are rather conservative. Other sources show lower figures within the same order of magnitude yet using different models and assumptions:
Valuechain (M. Khazzaka) Bitcoin Energy Efficiency research paper (June 2022)
Coinshares Research report on Bitcoin Mining (January 2022)
Cambridge Centre for Alternative Finance (figures updated daily based on a theoretical model)
Source | Publication date | Estimate (annualised) | Methodology |
August 2023 | 348 TWh | Survey of Bitcoin mining companies | |
October 2023 (updated daily based on theoretical model) | 131.73 TWh (81.53 - 232.22) as of 23 Oct 2023 | Upper/lower bounds reflect two extreme distributions of ASIC models assuming a worse-case and best-case efficiency scenario. | |
(Michel Khazzaka) | June 2022 | 88.95 TWh | Infers the distribution of ASIC models from the change in global hash rate over time. |
January 2022 | 89 TWh | Manually curates assumption of distribution of ASIC models using industry figures of ASIC production rates. |
Personal comment: I find it interesting to look at the different estimation approaches depending on the country of origin:
The American: "let's ask the people who do the work"
The French: "let's do some math"
The British: "let's be prudent with a large margin of error"
What are the sources of energy used to produce the electricity used by Bitcoin mining?
Most of the electricity used by Bitcoin mining is non-fossil. The top 2 sources are currently hydro (23.12%) and coal (22.92%).
See a full breakdown of energy sources used by Bitcoin mining globally in the report by Daniel Batten.
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