What if the world was hit by another major disaster, but this time with a global power outage? Would Bitcoin (BTC) survive, what about banks? We have the answers.
Bitcoin uses an enormous amount of electricity and with the steady growth of the network, this number will only increase. The Bitcoin protocol is based on the Internet for communication. So if the world’s power grids were suddenly cut, it could be concluded that this would make the cryptocurrency fail.
Bitcoin energy consumption in relation to the countries. Source: Digiconomist.
Bitcoin doesn’t need internet
Andreas Antonopoulos, however, disagrees. He believes that the decentralized nature of Bitcoin, combined with its ability to rely on alternative communication methods, would prove to be much more resilient than the traditional banking system:
“In fact, I would predict that Bitcoin will be one of the first things to come back when we have a massive power outage or natural disaster that damages infrastructure such as the Internet or the power grid. And the reason is that Bitcoin is not just a system is about self-financing, but also about decentralizing users, node operators and miners who would have many, many incentives to rebuild local infrastructure in a very decentralized way. Remember that Bitcoin does not need the internet to exchange transactions and blocks . “
In addition, Antonopoulos notes that Bitcoin may instead rely on satellites, radio, or phone lines for communication. In his opinion, Bitcoin would be the first to recover. While the global financial system would recover in a world without reliable power grids, it would likely take months if not years.
Governments can destroy the price, not Bitcoin
Antonopoulos believes that political attacks pose a much greater threat to Bitcoin, especially “poachers”:
“I’m concerned about political attacks, particularly sneaky ones, like changing the tax status of the cryptocurrency to bring it underground. And I believe that such a tax could alienate a large part of the middle class and speculative investors who won’t risk it to oppose that. ” Government to use Bitcoin. “
However, he concludes that while this would affect price and make implementation more difficult, it would not destroy the “system”:
“The price can be attacked in many different ways. And these attacks can drop the price quite dramatically and maybe even for long periods of time. But neither the monetary basis nor the technical operation of the network will change.” “
Bitcoin has long proven that its system is robust. The network had no downtime in 11 years of operation.