The International Monetary Fund states that cryptocurrency mining is far too energy intensive and warns that it will actually consume as much electricity as Argentina in 2018, Bloomberg reports.
“The Bitcoins (EXANTE: Bitcoin) mining, which is this accelerated and augmented use of computers to actually determine the value and incentive the functioning of the mechanism, is energy angry,” IMF Chief Christine Lagarde said in a Bloomberg TV interview.
“And we figure that in 2018 if it continues that system will actually consume as much electricity as Argentina.”
According to the data of Bloomberg New Energy Finance, the electricity needed by the global network of computers running the blockchain technology behind Bitcoin is equivalent to about 30 1.2-gigawatt nuclear reactors running at full capacity. It has more than tripled in the last year to over 37 gigawatt-hours a day.
“In times of climate change and when we look at how much coal is being used in some Chinese provinces to actually mine Bitcoin it’s a big concern,” Lagarde said.
Digiconomist’s Bitcoin Energy Consumption Index indicates that Bitcoin currently consumes more energy than Peru and Hong Kong, and if it were a country, it would be placed 53rd in the world between Iraq and Singapore.
Analysts say the amount of electricity needed to mine Bitcoins could fall if there are improvements in computing technology.