The Bitcoin network recorded the lowest energy demand of the year 2022 at 10.65 gigawatts (GW). At its peak, the BTC network demanded 16.09 GW of power.
Overall Bitcoin (BTC) network power consumption saw a drastic drop after mimicking a two-week drop in mining hash rate, reducing displacement power to mine BTC blocks to 199,225 exahashes per second. (HE/s).
According to data shared by the Cambridge Center for Alternative Finance, the Bitcoin network recorded the lowest energy demand of the year 2022 at 10.65 gigawatts (GW). At its peak, the BTC network demanded 16.09 GW of power.
Banking System Consumes 56 Times More Energy than Bitcoin
On June 16, a Cointelegraph report highlighted how the banking sector uses 56 times more energy than the Bitcoin ecosystem. Publisher Michel Khazzaka, an IT engineer, cryptographer, and consultant, said in an exclusive interview that:
“Bitcoin Lightning and Bitcoin, in general, are really great and very efficient technology solutions that deserve to be adopted on a large scale. This invention is brilliant, efficient, and powerful enough to achieve mass adoption.”
Khazzaka, who founded payment consultancy Valuechain in late 2021, proposes an alternative to the energy estimates provided by the Cambridge Bitcoin Electricity Consumption Index (CBECI). The index, often cited by Cointelegraph, estimates that Bitcoin consumes approximately 122 TW/H per year.
In the interview, Khazzaka explained that, “Lightning will allow the bitcoin protocol to do more transactions without consuming more energy. And this is magical.”
Khazzaka concludes that the combination of Bitcoin and the Lightning Network allows Bitcoin to be “194 million” times more energy-efficient than a classic payment system.
For him, “the banking and payments sector must embrace Blockchain technology and perhaps Bitcoin.” While his conclusion may come as a surprise to cypherpunks and anarcho-capitalists who favor the cryptocurrency space, Khazzaka believes that Bitcoin could, in fact, benefit banking, by stating that, “If they are brave enough, Blockchain technology will improve their efficiency and scalability.”
Possible Reasons for Sudden Reduction in Bitcoin Energy Demand
The sudden reduction in Bitcoin energy demand can be attributed to the hash rate drop. Mining hash rate serves as a key security metric, the computing power required by BTC miners to successfully mine a block.
Bitcoin mining difficulty reached an all-time high of 231,428 EH/s on June 13, followed by a drop of more than -13.9% in two weeks. The latest breakdown of the hash rate distribution shows F2Pool and AntPool as the largest known miners, with 81 and 80 blocks each mined in the last four days, respectively.
A group of federally funded researchers designed a class of stablecoin called the Electricity Stablecoin (E-Stablecoin) that would transmit energy as a form of information.
As Cointelegraph explained, the E-Stablecoin would be minted by inputting one kilowatt-hour of electricity, plus a fee, which could then be used for transactions in the same way as any stablecoin.
By Audy Castaneda
