Bit Coin Is More Energy Inefficient Than the Dollar

Bitcoin uses about 92 tarawat hours per year, according to the cambridge center for alternative finance. For comparison, in the us, households collectively use about one terrawat of energy to heat their water heaters for one year. The us. Dollar is legal tender in nine countries, including ecuador and l salvador. 17 countries still peg their currency to the dollar. Only el salvador has made bit coin legal tender just recently.

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We compare the U.S. dollar with Bitcoin on their key attributes to determine which is better for transactions and preserving wealth, which is most absurd and which has serious flaws.

Topics covered include:

How are new U.S. Dollars and Bitcoin created
How much has the supply of each currency grown
How both the dollar and Bitcoin have had rule changes
Why Bitcoin transactions are faster than non-cash U.S. dollar transactions
Why both the dollar and Bitcoin require add-on layers to facilitate transactions
How tax treatment of a currency can encourage or discourage its use for payments
Why divisibility is a critical attribute of any currency
Why Bitcoin has been as volatile as the Russian ruble
Why Bitcoin is energy inefficient while having built-in incentives to use renewable energy
What will determine the long-term viability of Bitcoin and the U.S. dollar

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Show Notes

Federal Reserve Statistical Release: H.4.1 Factors Affecting Reserve Balances of Depository Institutions and Condition Statement of Federal Reserve Banks, August 19, 2021

Check Processing—Federal Reserve Bank of New York

Gold Reserve Act of 1934—Federal Reserve History

Creation of the Bretton Woods System—Federal Reserve History

Financial Accounting Manual for Federal Reserve Banks, July 2021: Chapter 5. Federal Reserve Notes—Board of Governors of the Federal Reserve System

Financial Statements: Federal Reserve Bank of Kansas City; As of and for the Years Ended December 31, 2020 and 2019 and Independent Auditors’ Report

A Complete Guide to Understanding and Protecting Against Inflation—Money For the Rest of Us