Energy usage comparison of Bitcoin and AI

Recently, Bitcoin mining company Core Scientific (CORZ) signed a 200-megawatt cooperation agreement with cloud computing company CoreWeave. The former will modify some of its existing infrastructure to host the latter's high-performance computing GPUs. This collaboration symbolizes the formal intersection of Bitcoin and AI, two highly talked about industries.

Despite the popularity of both AI and Bitcoin in tech circles, the issue of energy use has not been at the forefront of discussions between proponents and opponents of AI. However, data centers will use 8% of the total U.S. electricity supply by 2030, up from just 3% in 2022, according to forecasts by investment bank Goldman Sachs. Research from French energy company Schneider Electric shows that by 2028, AI will account for 15% - 20% of data center energy needs, up from 8% in 2023.

So why isn’t AI’s energy use as demonized as Bitcoin? There are several reasons behind this.

1. Funding, influence and social respect

First, the flow of funds plays an important role. Hundreds of billions of investment funds have poured into the AI ​​industry, but Bitcoin did not receive such large-scale investment in its early days. These funds have brought participation from major companies such as Google, Microsoft, Amazon, and Meta, whose PR and media clout is unparalleled. When people hear the word "data center," they rarely think of the issue of "wasting energy."

In addition, leaders of these large companies, such as Microsoft CEO Satya Nadella and Meta CEO Mark Zuckerberg, have emphasized the revolutionary and positive impact of AI, which further enhances AI’s social respectability. In contrast, most of Bitcoin's supporters are cryptocurrency enthusiasts. Although their voices are loud, their influence is far less than those of these technology giants.

2. Differences in worst-case scenarios

When people think about extreme scenarios, they are often more likely to focus on the potentially catastrophic consequences of AI. For example, AI could become so good at art that it replaces humans in creative work, or the worst-case scenario is that AI becomes self-aware and begins to control humans, using their heat and electricity as energy sources.

In contrast, the worst-case scenario for Bitcoin could just be that it crashes and investors lose a lot of money, or that it succeeds and replaces the Fed as the global reserve currency. For ordinary people, these scenarios are far less scary than the potential threats posed by AI.

3. Impact closely related to life

If Bitcoin succeeds, it may make some people rich, but it will have little impact on most people's daily lives. However, the main narrative around AI is that it will make many jobs obsolete, which is a huge threat to many people. Instead of worrying about AI’s energy use, more people are worried about their own livelihoods.

On the other hand, many ordinary people are using AI to create art, write essays, or create Internet memes. The usefulness of AI is obvious to ordinary people, alleviating their concerns about energy use. The value of Bitcoin, such as preventing censorship of payments or making assets difficult to seize, is not so obvious to ordinary people until they actually need these features one day.

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4. AI and Bitcoin: Similarities but Differences

Undoubtedly, some people who attack Bitcoin’s energy use also question AI’s energy use. Overall, however, the different characteristics of AI and Bitcoin explain why the issue of energy use in AI has not attracted as much attention as in Bitcoin.

AI has a wide range of potential applications, from medical diagnosis to autonomous driving to financial analysis, making it valuable in many industries. The main applications of Bitcoin are still concentrated in the financial industry, especially as an investment tool and payment method. This difference in application scope makes people more accepting and tolerant of AI.

Overall, although both AI and Bitcoin have controversial energy uses, AI's energy use has not been as widely demonized as Bitcoin due to differences in capital flows, social influence, application scope, and potential threats. As technology continues to advance, both energy usage issues require more attention and solutions.