The bitcoin mining infrastructure uses a certain amount of energy and processing power to operate. The resource usage is often cited as part of arguments critical of bitcoin.

But relatively speaking how much more resources does bitcoin mining take compared to physical currency?

No body really talks about all the resources that it takes to use physical currency.

  • The money first has to be produced in a mint. That mint and the machines in it had to be built. These are all of course specialty machines and are probably very expensive. The building and machines require energy to operate. They all need to be maintained. And people need to be employed to do all those things.

  • Money is typically stored in banks. There are thousands of bank locations in the world. They all needed to be constructed. And those buildings all require resources and people to operate.

  • Physical currency must actually be moved. Moving any significant amount of physical currency requires security. A large store typically has to hire an armored car to transport money from their safe to the bank. An entire niche industry needs to exist to produce those vehicles. Security workers need to be employed to operate them and protect the money.

  • Money must be stored. Millions of safes/vaults were built so individuals, businesses, and banks can store their money. In general there is a lot of resources spent on securing physical currency.

  • I haven't used physical cash in a year. For me and most compatriots, Bitcoin's key competitors are gold and VISA. Therefore I expect comparisons with the costs of old fashioned physical cash will be unpersuasive to skeptics and won't win any worthwhile arguments about energy and sustainability. Mar 24, 2021 at 10:42
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    I don't think this is a bad question at all, it actually asks the right things, but given the uncertainty of how to even calculate the energy requirements of the traditional financial system, it seems like stack exchange might not be the best platform to answer this?
    – chytrik
    Mar 25, 2021 at 0:51
  • @chytrik I was hoping someone had done a study at some point and could just cite the result. Many banks list their operating costs in their quarterly financial reports. For example, the operating costs for Bank of America were 93 billion dollars in 2020. One could probably take the figures from the largest banks in the world and get a good chunk of the answer figured out.
    – user4574
    Mar 27, 2021 at 13:22
  • I've voted to reopen, because this topic seems to be more generally about comparing Bitcoin's energy footprint with alternatives than a specific moment in time.
    – Murch
    Apr 19, 2021 at 17:28
  • @Murch You are correct. The question is about comparing the cost of legacy financial systems vs bitcoin in general. So far the answers suggest that the legacy systems cost well over a trillion of dollars a year. Whereas the cost of bitcoin mining is in the 10s of billions range. The seems to make a pretty good case in favor of bitcoin.
    – user4574
    Apr 19, 2021 at 19:54

3 Answers 3


The most extensive research on this topic is:
"An Order-of-Magnitude Estimate of the Relative Sustainability of the Bitcoin Network" by Hass McCook
among others, it cover specific topic as the economic and environmental cost of cash printing & coin minting, banking system, gold mining & recycling etc ...

The results of the research are summarized in the tables below.

enter image description here take in mind that these data are from 2014, so Bitcoin cost of production and consumption are actually much higher.

These are the estimation about miners efficiency at the time, when the network hashrate was 130 Phash/s and the most efficient miner was Antminer S3 with 0.766 w/Ghash:

enter image description here

I redid the calculations using current hashrate of 186 Ehash/s, an efficiency of miners ranging from 0.1 w/Gh of Antminer S9 to S19 0.03 w/Gh and keeping all other assumptions the same, these are the results:

enter image description here

About 70/80 times more consumption than was in 2014 (depending on which energy efficiency you pick as network average). Certainly the costs of the other activities (banking, mining, minting) have also increased, but not in this size.

Although the research in question is detailed, the author was honest in saying that the data is not an accurate representation of reality, but an estimate of its order of magnitude.

  • This is a pretty good answer. I am glad that it seems to agree with my estimate in terms of cost.
    – user4574
    Apr 16, 2021 at 0:07
  • So what? Bitcoin is marketed as a payment system for buying goods and services. What is the (total cost / actual buying transactions).
    – ghellquist
    Apr 20, 2021 at 19:09
  • Nice answer, thanks. A problem is however that bitcoin's energy usage is proportional to the mining reward, and thus the picture will look very differently if bitcoins market capitalization would reach the market capitalization of gold. So a fairer comparison would be spent energy per dollar. Oct 15, 2023 at 7:47

Since no one else has made the attempt, I will (partially) answer my own question.

To create a lower bound on the operating cost of the non-bitcoin financial system, I will add the operating costs of the 10 largest banks in the world. 2020/2021 are atypical years, so lets use the operating costs from 2019.

According to the doughroller.net these are the "10 largest" banks in the world, whatever that means.

In total these banks employ 2.34 million people. Their combined annual operating cost in 2019 was $625 billion US dollars.

This is of course an underestimate of the total true cost because there are hundreds of smaller banks I didn't list, as well expenses incurred by individuals that I have no way of figuring out. Unfortunately it would probably take a large study by a university, government, or large financial institution to estimate a more accurate figure.

Below are the operating costs for each bank.

Industrial and Commercial Bank of China
Employees 460,000

China Construction Bank Corporation
EMPLOYEES: 330,000
OPERATING COST: $28.822B (listed as 188,132M RMB)

Agricultural Bank of China
EMPLOYEES: 444,000 employees
OPERATING COST: $38.556B (listed as 251.67B RMB)

Mitsubishi UFJ Financial Group
EMPLOYEES: 106,000 employees
OPERATING COST: $30B (¥2.8 trillion)

Bank of China
EMPLOYEES: 310,000 employees

J.P. Morgan Chase
EMPLOYEES: 245,000 employees

HSBC Holdings PLC
EMPLOYEES: 235,000 employees

BNP Paribas
EMPLOYEES: 190,000 employees

Bank of America (BAC)
EMPLOYEES: 208,000 employees

Wells Fargo
EMPLOYEES: 270,000 employees


I personally think the whole consumption argument is ignorant. it is not like anyone here plans to not consume energy, so as a whole the world is going to naturally consume more energy as we grow, the block chains energy is all energy that more or less would be there and consumed no matter what, though if we switch to a system that lives off energy consumption, wouldn't that then make energy a commodity and eventually lead to people being priced out of electricity? hmmmm...

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