Bitcoin’s Energy Consumption
Analyzing the electricity it takes to mine digital gold
Bitcoin cannot be created on a whim, unlike dollars, yen, euros, etc. Similar to gold, creating new bitcoins takes work.
Instead of relying on central bankers to determine money supply, Bitcoin is decentralized. Miners record transactions that are verified by a global network of nodes¹ enforcing Bitcoin’s protocol. As of writing, 18.5 million bitcoins are in circulation, having been mined as a reward for computational power securing the network.
Only 21 million Bitcoin will ever exist.
After its initial creation on January 3rd, 2009, anyone with a basic computer can participate in Bitcoin’s democratic network. As outlined in the Bitcoin white paper, mining “is essentially one-CPU-one-vote.” While all computers possess a CPU that is technically capable of mining, network competition quickly began to heat up as Bitcoin’s popularity surged. Today, tens of thousands of specialized computers compete to mine Bitcoin from all corners of the world.
