Why and How Bitcoin Consumes Energy
Bitcoin uses a proof-of-work protocol to operate the network, which means that miners expend real-world resources (electricity) in order to validate transactions and secure the blockchain. Rather than being a bug, this is a feature because it is what keeps the protocol decentralized.
Other consensus protocols such as proof-of-stake may have their use-cases, but they make numerous trade-offs compared to proof-of-work. They are far more complex, with more attack surfaces, and are prone to centralization over time.
In addition, Bitcoin miners use energy in a very unique and useful way. Specifically, unlike data centers or other types of electricity consumers, individual Bitcoin miners don’t require very high uptime or a lot of internet bandwidth, which means they can go to areas of stranded energy production or can be co-located with power generation facilities as load balancers.