Energy consumption in the production of bitcoin is also growing rapidly as bitcoin prices skyrocketed - Bitcoin mining now uses far more electricity than any electric car in the world.
The latest Morgan Stanley report predicts that by 2018, Bitcoin's electricity demand is expected to triple, with one year's electricity equivalent to one year's electricity demand in Argentina.
Analysts at the bank forecast that bitcoin mining could consume more than 125 terawatt hours this year, and that global electric vehicles will not reach that level by 2025. In a research note published on Wednesday, Morgan Stanley estimated that Bitcoin consumed 36 terawatt hours last year, the equivalent of annual power consumption in Qatar.
In contrast, FORTUNE analysts found that all the Tesla cars that have been on the road (according to Tesla's statistics, a total of about 280,000 by the end of 2017) could have consumed less than 1.3 terawatt hours last year Watt-hour. In the analysis, based on data reported to the US Environmental Protection Agency, based on the median mileage calculations for Tesla's Model 3 and Model S vehicles, each vehicle traveling at 15,000 miles is assumed to be close The national average for the United States is 30 kWh per 100 miles of electricity.
This means that last year's production of bitcoin consumed 29 times more electricity than all Tesla vehicles on the road today.
A friend named Frank99 posted a similar calculation at Tesla's online discussion forum where he wrote: "It's crazy."
In 2016, all electric vehicles in the world consumed about 6TWh.
The power consumption of bitcoin mining is so high because every new bit of Bitcoin needs to be encrypted by a powerful computer to solve complex math problems. Mining calculations are used to verify bitcoin transactions in the digital general ledger blockchain to ensure safety; however, they have the drawback of being very energy intensive. (People think that most other cryptocurrencies have far less power consumption than bitcoin.)
Morgan Stanley estimates that the cost of producing a bitcoin is between $ 3,000 and $ 7,000, including energy and hardware costs. Last Thursday afternoon, the cost of a bitcoin was about $ 13,500, dropping sharply from a high of nearly $ 20,000 the previous month.
Morgan Stanley analysts said in a research note: "However, according to the current bitcoin prices, bitcoin mining revenue is still very substantial, if the cryptocurrency continued to rise, we expect the world's mining power consumption will increase."
But analysts have yet to find the correlation between bitcoin prices and electricity costs, which means cryptocurrency investors do not factor in their actual production costs when buying bitcoin. This also means that while cryptocurrencies fluctuate abnormally and are even very sensitive to mining company information, Bitcoin prices are less likely to be affected by energy price fluctuations.
Analysts at Morgan Stanley said: "We do not think cryptocurrency values will be driven by electricity costs in the near future, and the price of cryptocurrencies does not seem to be entirely based on fundamentals in 2017."
However, bankers provide electricity companies with a proposal to use cryptocurrencies to push up their share prices. Analysts conclude: "Perhaps global utility companies should start accepting bitcoin payments."