A new report by Galaxy Digital has revealed that Bitcoin mining consumes approximately half of the energy consumed by the entire global traditional banking system every year. The research estimated that the global Bitcoin network consumes 113.89 terawatts per hour (TWh) of energy, compared to conventional banking’s 263.72 TWh. Similarly, the report estimated that gold mining needs 240.61 TWh of energy, also coming at a higher rate than the bitcoin network.

The Galaxy Digital study claims that a switch from traditional banking to Bitcoin might significantly reduce the energy requirements of the financial sector. However, it has also underlined that there is no denying that the Bitcoin network consumes a substantial amount of energy.  

Zoom In: Germany-based data company Statista has also recently created a chart in which it places Bitcoin within the ranking of all the countries based on their energy consumption, revealing that the popular cryptocurrency consumes more electricity than almost 70% of the countries in the world. An online tool maintained by the University of Cambridge had also previously estimated that Bitcoin uses 143 TWh of electricity per year. In the light of this data, Statista pointed out that if Bitcoin were a country, it would be the 27th most energy-demanding nation on Earth. This means that it needs much more energy than the developed countries like Norway and Switzerland, which consume electricity respectively 124 TWh and 56 TWh per year.

Previously On...: Recently, Tesla has announced that it stopped accepting Bitcoin as payment and suspended vehicle purchases by using popular cryptocurrency due to its adverse impacts on the environment. CEO Elon Musk has pointed out his concern about the rapidly increasing use of fossil fuels for Bitcoin mining and transactions. The company is looking at other cryptocurrencies with <1% of Bitcoin’s energy consumption and intends to use Bitcoin for transactions as soon as the mining process consumes energy at a more sustainable level. After the announcement, Bitcoin considerably decreased in value.

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