The Bitcoin has found a major enemy: itself. The energy consumption it generates is phenomenal and calls its existence into question. According to a study by the French company Selectra, a single transaction in Bitcoin consumes the energy equivalent of a light bulb for three months, i. e. about 100 kilowatt-hour (KWh). 500 times more than a credit card payment. And as Bitcoin's popularity increases, so does its environmental footprint.
Bitcoin and cryptocurrencies in general work with the blockchain principle to ensure the security of transactions. These famous blocks are produced by powerful computers that provide enormous computing power to encrypt the data, which must then be decrypted at the end of the chain, again requiring enormous computing power. As the value of the Bitcoin increases (its price could reach $400,000 by 2019), the more complex the equations to be solved, the more energy and computing power are needed.
Miners secure transactions with their computers and produce and earn Bitcoins or others in the process. "As soon as the value flies away, the miner will be tempted to spend a lot of energy to mine," say Aurian de Maupéou, co-founder of Selectra. There are 30 new investors every second.
Bitcoin energy consumption is a problem
And it won't stop because the mining is so interesting to anyone who knows how. Although today it is becoming increasingly difficult to mine bitcoin, the current and future price of Bitcoin plays a major role in the interest of continuing to mine. "The energy cost is estimated at $1.6 billion and mining revenues are 10 times higher," says Julien Maldonato, partner at Deloitte. Unless the currency collapses, we can expect much more alarming figures in the coming months and years.
Intense and catastrophic according to Aurian de Maupéou. " Bitcoin is not viable, neither for large-scale use nor for widespread use in transactions" he says.
Because this major energy problem cannot be solved without taking away from the Bitcoin what makes its strength: the security and anonymity guaranteed by the blockchain. "There are various solutions to reduce this consumption but they would lead to the concentration of computing power in the hands of the richest people or would call into question the very philosophy of Bitcoin," confirms Teunis Brosens, senior economist for ING Bank.
If Bitcoin continues its momentum and continues to break the energy ceiling, governments and institutions could also start to get involved as the issue of global warming becomes increasingly worrying. For other reasons, France has already proposed to regulate Bitcoin.