Some will take this as proof that the system of Bitcoin shouldn’t exist, even that we should attempt to close it down. For it is, according to these calculations, using vast amounts of energy:
Just one Bitcoin transaction uses the same amount of electricity as a British household for nearly two months, new figures have shown.
The amount of energy needed to run the cryptocurrency has soared to record annual highs of 77.78 terawatt hours the same as the entire electrical consumption of Chile.
The carbon footprint of a single transaction is the same as 780,650 Visa transactions or spending 52,043 hours watching YouTube, according to calculations by Alex de Vries, a blockchain specialist, at PWC.
“People react with disbelief, but the figures are true,” said Mr de Vries who founded the Digiconomist blog to highlight the impact.
All those calculations are over here.
Now, let’s not quibble about them, instead let us just assume that they’re correct. So, what should be done about this?
Nothing, obviously. No one’s found a free source of electricity – if they had then we’d all be worrying about this rather less, wouldn’t we? Therefore everyone is paying the costs of running the system. Those in the system are paying those costs that is. There’s no leakage of the direct costs from bitcoin users and miners to non-users and non-miners of Bitcoin, whatever might be happening with externalities. Those externalities being, of course no different from those from any other use of electricity and to be treated in the same manner.
So, what we’ve really got here is that some people like to allocate their resources to playing around with Bitcoin. As others prefer to do similarly obscene things such as peruse Readers’ Ewes from Llanelli and contemplate the artistry of Simon Cowell. All of which are things which, however absurd of even vile, people have every right to do. For we’re a liberal polity which means that consenting adults get to be consenting adults. As long as they’re covering the costs of their activities themselves then that’s just what peeps like to do – Shrug.