Tesla and Elon Musk announced today that the company would stop allowing Bitcoin to purchase its products.
Musk went to Twitter to call the energy usage “insane” despite being a firm proponent of the cryptocurrency and others around it.
He said that he and the company would hold the coin and find alternative cryptocurrencies that would use less energy than Bitcoin.
All the news of Bitcoin’s energy usage has sent a shockwave among investors and those mining the coin with more than a 13 per cent price drop in 24 hours.
So how much energy does Bitcoin use and how does it compare to its rival Ethereum, Litecoin and others like it?
Here’s what we know about Bitcoin and it’s carbon footprint compared to others:
How much energy does Bitcoin actually use?
(Image: Getty Images)
It appears quite a lot. Cambridge researchers say it consumes around 121.36 terawatt-hours (TWh) a year – and is unlikely to fall unless the value of the currency slumps.
One of the reasons why Tesla reversed its decision to accept Bitcoin is due to its environmental image that it portrays.
But there are other coins that do use much less energy than Bitcoin.
Dogecoin, one of the newest cryptocurrencies that Elon Musk has also praised, has been rated at 0.12 kilowatt hours per transaction. (KWh)
Litecoin, which has been described as silver to Bitcoin’s gold, is rated at 18.522 KWh, while Ethereum uses 62.56 KWh.
Ethereum has pledged that it would endevour to lower its consumption by 90 per cent.
Vitalik Buterin, the 24-year-old Russian-Canadian computer scientist who invented Ethereum when he was just 18, said that Ethereum mining “is a huge waste of resources, even if you don’t believe that pollution and carbon dioxide are an issue. There are real consumers—real people—whose need for electricity is being displaced by this stuff”.
Bitcoin, the most successful of all the cryptocurrencies, is bottom of the list at 707 KWh.