New research suggests that AI could soon use more energy than BTC mining. This will make the galloping genAI industry a serious threat to the cryptocurrency industry. Can AI actually threaten Satoshi Nakamoto’s cryptocurrency?
More power, the system will last. Energy-hungry AI with a ravenous appetite
Generative AI is a boom that the whole world has been living with for two years. The beginning of this period is considered to be November 30, 2022, because that was when the world premiere of ChatuGPT 3.5 took place. Everyone could test the chatbot, and the marketing machine started in earnest. After less than two years, we are at a place where AI has become mainstream and pushed into almost every device to drive sales.
On the other hand, AI systems are actually changing our everyday lives. A great example of this is a start-up founded in the US by two Poles, which is revolutionizing the dubbing market. I am of course talking about Eleven Labs, an AI tool that is able to generate realistic-sounding human voices. Okay, revolution is revolution, but what does AI have to do with Bitcoin? It turns out that quite a lot, because generative AI is extremely energy-hungry. Tech giants like Microsoft and Amazon are already wondering how to satisfy AI’s appetite for electricity. This in turn means that BTC is no longer the “whipping boy” when it comes to the use of electricity.
Can Artificial Intelligence Threaten BTC?
This threat will become a reality in the coming years. AI is more energy-hungry and competes with Bitcoin for access to hardware and electricity. AI companies can afford to outprice miners, which could lead to data centers being converted from Bitcoin mining to AI processing. AI can generate up to 25 times more revenue per kilowatt-hour than Bitcoin, forcing some miners to consider changing their business. A great example of the transformation of miners into AI power providers is Ethereum’s transition from Proof-of-Work to Proof-of-Stake. Many mining companies have since changed their business to providing computing power to AI companies.
Generative AI and the industry built around it, while still in its early stages, are showing huge energy demands. AI image generation can use as much energy as a full smartphone charge, which could outpace Bitcoin’s energy needs in the coming years. As a result, competition for energy resources between AI and Bitcoin will intensify, and the operational flexibility of Bitcoin miners will certainly help them in this competition.
