- Ripple’s CEO lays out how he came up with the figure that one Bitcoin transaction is equivalent to about 75 gallons of gasoline.
- According to a recent study by CoinShares, about 35-40% of all energy used for BTC mining comes from renewable sources.
In a recent interview with CNN’s Julia Chatterley, Ripple CEO Brad Garlinghouse criticized Bitcoin, claiming that “one transaction is equivalent to about 75 gallons (about 284 liters) of gasoline being burned” while pointing to its supposed negative environmental impact. Moreover, in the same breath, he stated that the XRP ledger is 100,000 times more energy efficient.
While Garlinghouse clarified that he was a “fan” of Bitcoin, he said that he only saw it as a store of value, not a means of payment. Nevertheless, or perhaps because of it, the Bitcoin community did not react very kindly to the comment.
In particular, the community questioned how Garlinghouse came up with the figure of 75 gallons of gasoline. One of them was crypto journalist Frank Chaparro. He tweeted, “Seriously. Very curious how many gallons of oils each bitcoin transaction requires. Do any of you know?”
Ripple’s CEO responded to the tweet, replying in a Twitter thread:
Guess I touched a nerve! My comment was about how many gallons of gas emit the same amount of CO2 as a BTC txn (could’ve been more clear in the clip). First off, I’m DEFINITELY not saying ban BTC! I’m saying we, collectively, can and should understand PoW’s carbon footprint.
As Ripple’s CEO explained, it is based on the Cambridge BTC Index’s Average, and specifically March’s data. According to that data, Bitcoin consumed 132.07 terawatt hours annualized in March. Garlinghouse divided this value by 365 days and got 0.362 TWh (the daily average). Multiplying by the average number of transactions per day in March – 301,359 transactions – gives 0.000001201 TWh for the average energy per transaction.
Further, based on Digiconomist’s data, Garlinghouse assumed that 0.49 megatons of CO2 are produced per TWh. This in turn means that 0.000000588 Mt [metric tons]of CO2 is generated per transaction. Since the U.S. Environmental Protection Agency states that 112,523,894 gallons of gas produce equal to 1 Mt of CO2, therefore “~70 gallons of gas is emitted from 0.000000588 Mt of CO2.” In response to the accusation of spreading FUD about Bitcoin, Garlinghouse says:
We have the tools to make crypto 100% renewable AND reach its full potential. Let’s focus on the solutions to change the opinion of Janet Yellen, Bill Gates, and countless others who have pointed out concerns about energy usage instead of accusing me of FUD.
As we all know, “massive” energy consumption is an issue that critics always cite against Bitcoin. However, the claims are mostly untrue, as Bitcoin mining does consume a lot of energy, but much of it is renewable.
A recent study by CoinShares found that at least 78% of Bitcoin miners use renewable energy. The same study also states that about 35-40% of the total energy used for mining comes from renewable sources. While this is not the 100% demanded by Garlinghouse, it is a great number that many large industries can only dream of. In addition, Coinshares’ Tatiana Revoredo stated in the report:
Many renewable energy generators are poorly located and underutilised, and thus, Bitcoin mining has become the only viable use for this electricity.
