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12 Jan 2023
How Big an Impact Does Bitcoin Really Make?
The bitcoin bust of mid-2022 cut its global electricity consumption by one-third, where it remains at the present moment. How much consumption is that? How big an effect does bitcoin, in fact, have on the global energy grid?
The Cambridge Center for Alternative Finance (CCAF), located at the UK's Cambridge University, keeps track of this valuable metric. At its current, seven-day rolling rate of a steady-state consumpion of 10.89 GW, crypto is consuming about 0.4% of the global electricity grid.
The United States currently mines 35.4% of bitcoin, according to World Population Review. That grabs about 0.85% of the US electricity grid, according to IDCA Research. A far more dramatic situation is found in Kazakhstan, which mines 18.1% of the world's bitcoin on a very small grid, thus devoting 18.6% of its grid to this mining.
Other significant bitcoin miners include Canada (with 1.6% of its grid), Ireland (1.8% of its grid), and Malaysia (3.2% of its grid).
All of these nation-by-nation figures would rise by about 50% should Bitcoin again reach its peak mining requirements and if China doesn't get back into this business.
Devoting an amount approaching 1% of the US electric grid to bitcoin, and higher amounts in a few other countries, can seem like a disproportionate amount to be devoted to a single, narrowly-held asset.
Yet bitcoin's market capitalization as of this article's writing is about $360 billion, comparable to about 0.4% of global GDP; bitcoin burns the same proportion of energy as the market value it has created. It will be instructive to see how this proportion holds up in the coming year.
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