Revisiting Bitcoin’s Energy ‘Problem’ in the Face of ESG Investment Mandates
The preceding point about transaction validation is important because it is enticing to compare the energy density of Bitcoin transactions to something like Visa (V). Bitcoin can only handle seven transactions per second compared to Visa’s 24,000+. But, remember, Bitcoin doesn’t use energy to validate transactions. The miners’ job is to secure the network, add new blocks of data to the chain and win bitcoin in return. That’s what they spend energy on. They’re not primarily interested in validating transactions. That consensus on the true state of the network is primarily the job of non-mining, Bitcoin full nodes. Plus, Bitcoin transactions are not the same as Visa or other payment processors’ transactions. Bitcoin transactions provide (probabilistic) finality, Visa’s don’t. Visa’s success depends on the success of separate systems. Visa’s “token” is not native to its network.