The energy consumption of Bitcoin in the future is highly dependent on the future price of Bitcoin (BTC), according to an analysis by Arcane Research. If the price of BTC reaches 2 million dollars by 2040, the energy consumption of Bitcoin can reach 894 TWh per year. However, if the price of BTC reaches $500,000 by 2040 by 223, Bitcoin will consume only 20 TWh per year. This is almost twice the current power consumption, despite a XNUMX-fold increase in the price of BTC.
The energy consumption of Bitcoin is highly dependent on the price of BTC
Jared Mellerud, an analyst at Arcane Research, in a series of tweets on August 23, shared data on Bitcoin’s energy consumption in 2040 and how the price of BTC massively impacts future energy consumption.
The future energy consumption of Bitcoin is highly dependent on the price of BTC, transaction fees, the percentage of miners’ revenue spent on energy, and the average price of energy.
Estimated energy consumption of Bitcoin 2022-2040. Source: Arcane Research
If the price of BTC reaches $2 million by 2040, the energy consumption will be 894 TWh per year. This is a 10x increase from current levels. Additionally, Bitcoin may contribute 0.36% of estimated global energy consumption in 2040, up from 0.05% today.
However, if Bitcoin fails to make a bullish rally and the price reaches $500,000 by 2040 due to the Bitcoin halving and positive developments. So energy consumption will be 223 TWh per year, just over double the current level.
Interestingly, power consumption «will be cut in half to 45 TWh per year or 0.02% of global power consumption» in a downside scenario. The price of Bitcoin (BTC) will reach at least $100k by 2040 due to the halving.
Furthermore, the future energy use of Bitcoin will also depend on transaction fees. At $100k, power consumption increases by 7 TWh for every additional 0.1 BTC in transaction fees per block.
Similarly, Bitcoin’s share of global energy consumption will be 0.36% if the price of BTC reaches $2 million by 2040 and transaction fees remain stable.
“A massive 0.05% increase today, but still well below the doomsday estimates provided by certain Bitcoin critics.”
However, energy consumption will still be below 2% of the energy consumption of the cement production industry. Cement production consumes 4,238 TWh of global energy consumption.
Will the price of BTC reach such high levels?
Bitcoin (BTC) price hit an ATH of $68,789 21 amid mass adoption. Currently, the price is trading in the range of $25k-XNUMXk, but it is likely to increase due to halving.
Bitcoin mining will become a significant area of energy consumption only if the BTC price reaches a few million dollars. The price of BTC depends on the market demand, while transaction fees depend on its use as a medium of exchange.
Spending 0.36% of energy on future technologies that deliver security, value, and speed is more than worth it.
Varinder is a technical writer and editor, technology enthusiast, and analytical thinker. Fascinated by disruptive technologies, he has shared his knowledge of Blockchain, Cryptocurrencies, Artificial Intelligence and the Internet of Things. He has been associated with the blockchain and cryptocurrency industry for a considerable period and currently covers the latest updates and developments in the cryptocurrency industry.
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