Key Takeaways
- Elon Musk emphasized that Bitcoin derives its value from the real-world energy required to produce it.
- Musk’s comments came in response to a post about AI driving up global energy demand.
- While Bitcoin advocates highlight its resistance to monetary debasement, critics point to its massive energy consumption, which rivals that of entire nations.
Elon Musk said on Tuesday that Bitcoin’s value stems from its reliance on real energy, contrasting it with traditional fiat currencies that governments can create at will.
The world’s richest man, who has a history of criticizing government spending, once again publicly placed digital gold above traditional finance.
Bitcoin Is Energy
Musk claimed that Bitcoin’s value is rooted in real-world energy use, arguing that while governments can print money, they cannot “fake” the energy that underpins Bitcoin’s creation.
Responding to a post by financial blog ZeroHedge on X about AI driving up global energy demand, the Tesla and SpaceX CEO wrote:
“True. That is why Bitcoin is based on energy: you can issue fake fiat currency, and every government in history has done so, but it is impossible to fake energy.”
ZeroHedge had described AI as the “new global arms race,” suggesting that while governments will pour vast sums into developing the technology, the real constraint will be energy supply.
“The money is not the problem… But you can’t print energy,” the account said.
Anti-Debasement
ZeroHedge linked the rise in prices of gold, silver, and Bitcoin to what it called the “debasement” of money, the gradual loss of purchasing power that occurs when more currency is created to fund major national projects.
Historically, debasement referred to reducing the precious metal content in coins. In modern economies, it often describes the effects of monetary expansion, such as central banks “printing money.”
Crypto advocates have long argued that Bitcoin is designed to resist debasement, due to its fixed supply of 21 million coins and energy-intensive mining process.
They claim this helps prevent manipulation by governments or central banks, unlike fiat currencies, which can be issued in unlimited quantities.
One of the world’s leading Bitcoin advocates, MicroStrategy CEO Michael Saylor, responded to Musk’s post:
“The laws of nature are superior to the laws of man.”
Crypto’s Energy Issue
Bitcoin’s actual energy consumption has reached levels comparable to those of entire nations, drawing growing criticism over its environmental footprint.
The network uses about 250 gigawatt-hours (GWh) of electricity each day — a scale of demand that rivals the daily power consumption of several smaller countries.
In an article by Steven Ferrey, a professor of law at Suffolk University Law School, he claimed the cost of crypto has had an “astronomical” impact on the energy industry.
Ferrey noted that some residents in New York towns have seen their energy bills increase by more than 30% in some cases.
Over a year, that amounts to roughly 91,500 GWh, more than the annual energy use of over 80 nations.
To illustrate the magnitude, Bitcoin’s daily electricity use equals nearly 228 days of energy consumption in Somalia.
In U.S. terms, the same amount of energy could power around 8.4 million homes for an entire day.
Kurt Robson is a London-based reporter at CCN, specialising in the fast-moving worlds of crypto and emerging technology. He began his career covering local news in Cornwall after graduating from Falmouth University with First Class Honours in Journalism. There, he cut his teeth on everything from council meetings to missing swans.
He quickly rose through the ranks to become a frontline journalist at several of the UK’s leading national newspapers. Over the years, he has interviewed musicians and celebrities, reported from courtrooms and crime scenes, and secured multiple front-page exclusives.
Following the upheaval of the COVID-19 pandemic, Kurt shifted his focus to technology journalism—just ahead of the AI boom. With a natural curiosity and a trained eye for emerging trends, he has found a new rhythm in reporting on innovation.
At CCN, Kurt's work focuses on the cutting edge of crypto, blockchain, AI, and the evolving digital world. Drawing on his background in people-first reporting and his deep interest in disruptive tech, Kurt delivers stories that are insightful, entertaining, and human-centric.
