Btc Hits $100k,$500k,and $2M By 2040, Energy Consumption Will Decline
According to an estimate by Arcane Research, the future energy consumption of bitcoin is highly dependent on the price of bitcoin (BTC). By 2040, if the price of bitcoin hits $2 million, it may need 894 TWh of energy annually. However, if the price of BTC rises to $500,000 by 2040, only 223 TWh will be used annually. Despite a 20x increase in the price of Bitcoin, this is almost twice as much energy as it currently consumes.
Bitcoin Energy Consumption is Highly Affected by BTC Price
On August 23, Arcane Research analyst Jared Mellerud presented information on the energy consumption of Bitcoin in 2040 and how the price of BTC would have a significant impact on energy consumption. Future Bitcoin energy usage is mostly influenced by the price of BTC, transaction fees, the percentage of miner earnings that is spent on energy, and the average price of electricity.
The annual energy usage will be 894 TWh if the price of one bitcoin hits $2 million by 2040. In comparison to present levels, this is a 10x increase. Additionally, rather than the current contribution of 0.05%, Bitcoin may provide 0.36% of the predicted worldwide energy consumption in 2040.
However, if Bitcoin does not experience a bullish rebound and the price reaches $500,000 by 2040 as a result of favourable developments and the halving of Bitcoin. The annual energy consumption will then be 223 TWh, or just over twice the current amount. It's interesting to note that under a bearish scenario, energy consumption "would drop to 45 TWh per year or 0.02% of the global energy consumption." Due to halving, the price of Bitcoin (BTC) will at least reach $100k by 2040.
The future energy consumption of Bitcoin will also be influenced by transaction fees. At $100k, each additional 0.1 BTC in transaction fees each block results in an increase in energy consumption of 7 TWh. Similarly, if Bitcoin's price hits $2 million by 2040 and transaction fees don't change, it will account for 0.36% of world energy use. But the energy use will remain below the 2% energy consumption share of the cement manufacturing sector. 4,238 TWh of the world's energy usage goes toward cement production.
Will the price of BTC reach such high levels?
Amid widespread adoption, the price of Bitcoin (BTC) reached its all-time high of $68,789. The price is now fluctuating between $21k and $24.5k, but it is anticipated to increase due to halves. Only when the price of bitcoin hits a few million dollars will bitcoin mining become a substantial source of energy usage. While transaction costs are based on the use of BTC as a medium of exchange, the price of BTC is based on market demand.
Future technologies that offer security, safety, value, and speed are well worth the 0.36% energy investment.
