100X Bitcoin energy consumption would mean “absurd” $ 20M BTC price – developer
A new contributor to the Bitcoin (BTC) energy debate says that 1 BTC must cost $ 20 million to use 100 times current energy needs.
In a Twitter debate On July 18, Sjors Provoost, a Bitcoin developer and author of “Bitcoin: A Work in Progress”, casts doubt on the future energy consumption of the largest cryptocurrency.
Bitcoin can survive on “throwing energy breadcrumbs”
How much energy Bitcoin uses to survive has become a friction issue that has gone from industry to global governments.
Throughout the process, Bitcoin supporters have complained that a combination of bias and lack of understanding of network principles leads those in power to draw incorrect conclusions about how and why Bitcoin uses the energy it does.
While critics argue that Bitcoin needs to reduce energy consumption, others explain that Bitcoin actually uses energy that would often otherwise be wasted or unavailable.
To discuss the status quo, co-developer Matt Odell published a graphic showing that Bitcoin mining currently uses only 0.49% of the world’s wasted electricity, and 0.16% of the electricity in total.
In response, Provoost calculated that in order for energy consumption to increase in proportion to changes in the Bitcoin network’s pre-programmed changes, there must be an “absurd” unit of $ 420 trillion.
«In 10 years, the block grant will be ~ 10x lower (3 halves). To get 100 times the current energy consumption, Bitcoin would have to trade for 20 million dollars by then (plus adjustment of energy cost inflation), “he wrote.
“But a market value of $ 420T is absurd, more than ALL property.”
Bitcoin’s halving cycles mean that the block grant – the amount of “new” BTC added to the supply per recovered block – is halved approximately every four years. Each time the mining ecosystem competes for less BTC, and thanks to Bitcoin’s Proof-of-Work (PoW) mining algorithm, it remains incentivized to do so, using more hardware for their endeavors.
More hardware means more power, but at the same time, the smaller rewards, more efficient hardware and greater impact of transaction fees on miners’ incomes should keep energy consumption in check, says Sjors.
“Another 12 years later, and even though Bitcoin is worth more than all the world’s property, the mining support would not be enough for Bitcoin to use more than 1% of global energy,” he continued, noting that his calculations were not verified.
“So if nothing strange happens before 2030, it can probably continue to run on waste energy breadcrumbs.”
The struggle of the miners is real
As Cointelegraph continues to report, Bitcoin miners are currently facing challenging times thanks to the BTC price falling to levels that make the whole practice of mining unprofitable for some.
Related: BTC miners ‘finally capitulate’ – 5 things to know in Bitcoin this week
This was evidence in recent days when more than 14,000 BTC left miners’ wallets – a signal that miners chose to sell funds to stay afloat.
These “capitulation events” among the mining community have traditionally been accompanied by macro-price bottoms.
Compared to its last all-time high in November 2021, BTC / USD has lost up to 74.5%.
Puell Multiple, a calculation that compares the value of recently issued BTC against the 365-day moving average, is currently close to historical lows.
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