Bitcoin is criticized heavily due to its high resource use and high carbon footprint. So in this article I want to compare the CO2 footprint of Banks and BTC.
According to Digiconomist, Bitcoin uses 61.88 TWh of electricity annually (as of 21.04.2018) and this results in a 30322 kton of CO2. 1 TWh of electricity offsets 490 kton of CO2.
Bank Branches
In 2016, according to the World Bank’s statistics there were 12.527 bank branches per 100.000 people in the World. 2018 World population was 7.6 Billion and this means that we have over 950 000 Bank branches worldwide. A small business on average consumes around 30 mWh/year. When you multiply 30 mWh/year by 950 000 branches you get a stunning 28 500 000 mWh/year. This is also equal to 28.5 terawatts.
Bank branches generate: 28.5*490 = 13965 kton of CO2.
ATM’S
There are 3 million bank ATM’s worldwide. Average electricity consumption of an ATM is 2000 kWh/year. Total energy consumption of ATM’s are 6 000 000 MW h/year and this is another 6 terawatts.
Atm’s generate: 6*490 = 2940 kton of CO2.
User’s Commute
There are 2.5 billion unbanked people, I will assume that 4 billion people use banks. In order to go to bank these people use some type of transportation. I have calculated an average of 16 miles (24kms) of transportation via a gas using vehicle per person annually to access to the banks. This generates 18570 kton of CO2. With bitcoin you don’t have to travel to a bank as you are your own bank.
Employee’s Commute
I am assuming that on average each bank branch has 10 employees. You can see the employee/branch data below, it was really hard to gather whole data for the banking industry so we will continue with educated guesses. Branch numbers and total employee numbers of top 10 USA banks were used to estimate average employee per branch. I calculated a total of 9,500,000 employees, 240 working days and 4 miles (6.4 km’s) commute each day.
CO2 Generated as a Result of Paper Use
The last but not the least is the paper consumption by the banks and its effect on the environment. 500 pages of paper weights approximately 4.5 pounds. I calculated 10 pounds of paper use -equivalent to 1125 pages- per employee per year. This really is a modest number, as the Average U.S. Office Worker Uses 10,000 Sheets of Paper Per Year. 10 pounds of paper use per Bank employee generates, 226,188,557 pounds of CO2. This is 102,813 kton CO2 release in a year. While generating this CO2 we also chop 135,659 tons of trees.
Other CO2 Generator’s
There are many other ways that Banks use energy, create waste and generate CO2 (mail deliveries, printing of money, stamping coins, Bank branch construction, etc) It is not even necessary to go into those details as I believe that I was able to paint a clear picture.
Results
Of course both Bitcoin and Banks have other energy uses, I have just written down the most significant ones. (Paper use is 1/8th of the average office use of 10 000 pages a year/emplotee, the real number is way higher…)
Verdict
Finally, I am not saying Bitcoin doesn’t use a whole lot of energy but in fact it is only a fraction of the resources the alternatives use and energy used is money secured without any deforestation.
