Q: Recently on TV, they have commented on the high amount of energy used in bitcoin money transactions. Some examples used were the same as a large city or a small country’s consumption of energy. I thought computer energy use was very small. Is that true? If so, why is the bitcoin energy use so high versus other transactions of money?
—Allen Trent, Canton
A: Very little energy is used in making bitcoin transactions with previously mined bitcoins, William Lastrapes, an economics professor at the University of Georgia's Terry College of Business, told Q&A on the News via email.
“When I exchange bitcoins from my bitcoin ‘wallet’ with a retailer — who accepts these coins into his or her ‘wallet’ — in exchange for goods, the energy usage is very small and no different from any other electronic transaction made on the internet—like using your bank’s online bill pay,” Lastrapes wrote.
He said the process of “mining” for new bitcoins uses “massive amounts of energy.” To generate new bitcoins, “miners” must solve complicated math problems—and in the process verify blocks of bitcoin transactions — which requires a lot of computer processor time and, thus, a lot of energy.
“Once bitcoins are mined, however, their use as a means of payment for goods and services requires no excess energy usage,” he wrote.
Fast Copy News Service wrote this column; Maggie Scruggs contributed. Do you have a question? We’ll try to get the answer. Call 404-222-2002 or email q&a@ajc.com (include name, phone and city).
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