“Bitcoins Mining is Energy Angry”, said Christine Lagarde – the General Director of IMF
The General Director of the International Monetary Fund (IMF) is worried about the energy consumed by the activity named: Bitcoin mining.
In an interview offering for Bloomberg TV, Christine Lagarde mentioned that “The Bitcoins mining, which is this accelerated and augmented use of computers to actually determine the value and incentive the functioning of the mechanism, is energy angry”.
Ms. Lagarde was present at the World Economic Forum between 23-26 January 2018, an annually event held in Davos, Switzerland. She expressed both positive and negative opinions about the use of cryptocurrencies, arguing that if it continues with the same steps “the system will actually consume as much electricity as Argentina.”
According to Bloomberg Technology, the Bitcoins mining has tripled its necessary energy to proceed the activities. In December 2017, the global network reached an energy consumption of over 37 gigawatt-hours per day. “That’s equivalent to about 30 1.2-gigawatt nuclear reactors running at full capacity.”
The team consisting of analysts Michael Weinstein, Khanh Nguyen and members from USA Credit Suisse Bank made a research about Bitcoin’s mining energy. The United States of America consumes around 4,3 million gigawatts per year, while China eats only 6 million of gigawatts. They found that the price for 1 Bitcoin needs to be around 1 million US Dollar so that the mining process would consume the global energy power.
However, more and more investments are made in Bitcoin mining centers. This generates a headache of the country’s governments, because once miners’ number grows, it will increase the amount of consumed energy globally. At one point, this can create a deficit in some countries.
To avoid the potential economic imbalances, mining centers are expected to invest in their technologies with the purpose to consume the energy more efficiently.
Christine Lagarde is being stunned in some way about cryptocurrencies technology. She said in an interview that “What is fascinating about [cryptocurrencies] is the technology that is underneath, this distributed ledger technology that guarantees identification, trustability, authentication of transactions, without intermediation, I think that was the dream of the original Bitcoin inventors”.
Also, she has noted an important negative aspect of the cryptocurrency usage: “The anonymity of it is likely to facilitate money laundering, dark money moving around, and things that no one is happy about, if we are looking for financial stability and transparency of financial transactions, so that’s the dark side”. (Bloomberg TV)
Do you think that IMF will implement a strict regulation against the cryptocurrency usage?