This happens because the process of “mining” the cryptocurrency – using gigantic servers that do not stop working – consumes a lot of energy.
According to the researchers, bitcoin mining uses about 121.36 terawatt-hours (TWh) of electricity per year, a record that causes a strong impact on the environment and surpasses a long list of countries.
The issue returned to debate after Elon Musk, through his electric car company Tesla, reported the purchase of $ 1.5 billion in bitcoin, triggering the price of the currency and sparking criticism for the pollution it generates.
This latest rise in the price of bitcoin – which has followed a meteoric uptrend in recent months – has given new incentives to currency miners to run more and more computers in order to generate more cryptocurrencies.
As the price of bitcoin rises, electricity consumption rises, says Michel Rauchs, a researcher at the CCAF, where they created an online tool that allows these types of calculations.
“It really is by design that bitcoin consumes so much electricity,” Rauchs explains to the BBC. “This is not something that will change in the future, unless the price of bitcoin drops significantly.”
The researchers work with the Cambridge Bitcoin Electricity Consumption Index (CBECI), which provides real-time estimates of how much electricity generation of the currency consumes.
This index works based on a model that assumes that the machines used to mine in the world work with different levels of efficiency.
By following the relationship between an average price of electricity per kilowatt hour (US $ 0.05) and the energy demand of the bitcoin network, the tool estimates how much electricity is being consumed at any given time.
“Bitcoin is anti-efficient,” says David Gerard, author of the book “Attack of the 50 Foot Blockchain.”
“It is very bad that all this energy is literally wasted in a lottery.”
Why does bitcoin consume so much electricity?
The machines dedicated to “mining” or extracting bitcoins are specialized computers that connect to the cryptocurrency network.
Their job is to verify the transactions made by the people who send or receive the currency, in a process that involves solving complex mathematical puzzles.
As a reward, miners occasionally receive small amounts of bitcoin in what is often compared to a lottery.
To increase profits, miners connect a large number of computers, with the aim of increasing their chances of getting bitcoin.
And since computers work almost day and night to complete puzzles, electricity consumption is very high.
Electricity consumption vs carbon footprint
There is a big difference between energy consumption and carbon footprint, argues Nic Carter, founding partner of the venture capital firm Castle Island Ventures, which specializes in the blockchain sector.
“If we only look at energy consumption we are not telling the whole story,” he tells BBC Mundo.
Although it is true that most of the electricity is produced from fossil fuels such as coal, oil or gas – which are highly polluting – renewable energy (such as hydroelectric or wind) or nuclear energy are also used.
So, while the level of electricity consumption matters, you also have to take into account how that electricity is generated, says Carter.
For example, he notes, there are miners in China who take advantage of surplus hydroelectric power in dams. If they didn’t use it, that energy would simply be lost.
That explains why bitcoin mining has expanded so much in Sichuan and Yunnan provinces.
Another case occurs when some miners capture the discharged or burned methane (which is a by-product of oil extraction) and use it to generate the electricity required by their computers.
Many activists consider these examples to be specific cases that do not remove environmental responsibility from the bitcoin industry.
Still, Carter warns that bitcoin mining will be over in a few years, since the system was designed in such a way that the mathematical puzzles that computers solve will come to an end.
“This process is 88% complete,” he says, which in practice means that it becomes increasingly difficult to continue mining.
However, as the price continues to skyrocket, energy consumption is likely to increase as well.