Bitcoin mining consumes more than half a percent of the world's electricity

The annual energy consumption of the Bitcoin mining industry has reached an impressive 138 TWh, which compares to 0.54% of global electricity consumption. This data is presented in a new report prepared by the Cambridge Center for Alternative Finance at Judge Business School.

Despite the high energy consumption, nearly half of the electricity used — 52.4% — comes from sustainable sources. Hydroelectric power makes the largest contribution, accounting for 23.4%. Wind power accounts for 15.4%, nuclear power for 9.8%, solar power for 3.2%, and other renewables for 0.5%. The remainder, 47.6%, still relies on fossil fuels, primarily natural gas, which accounts for 38.2%.

At the same time, a significant concentration of mining capacity is concentrated in one country - 75.4% of the total hashrate is provided by participants located in the United States. The remaining active regions are Canada (7.1%), as well as parts of South America, Northern Europe and the Middle East. The distribution remains extremely uneven, which potentially increases the vulnerability of the network in the event of regional failures or political restrictions.

A serious challenge for the industry is the gradual reduction in block mining rewards associated with the halving algorithm. Analysts emphasize that a decrease in miner income may reduce interest in participating in blockchain support. In the long term, this poses risks to network security: in the context of declining mining profitability, the likelihood of capacity consolidation increases, and therefore the risk of attacks aimed at seizing a controlling stake in the hashrate.

One of the proposals for the future is a shift in focus towards increasing transaction fees. However, the current level of these fees still does not allow to completely replace the block reward, which calls into question the sustainability of the Bitcoin financial model in its current form.

Interest in mining infrastructure remains: investment activity confirms long-term expectations from the crypto market. Thus, Tether recently sent $32 million to Bitdeer, a company engaged in the mining of digital assets. This move is seen as an indicator of continued institutional interest in the segment, despite rising costs and regulatory pressures.