The integrity of electric power forecasts is a subject close to Koomey's heart. He was part of the team in the mid-1990s that debunked widely circulated projections of power consumption by the internet. Those studies overstated the internet's share of U.S. electricity consumption by at least a factor of 8 and projected it would double in 10 years.
"It turned out to be a bunch of nonsense, but it takes pages and pages of work to debunk an errant sentence," Koomey said.
Now, Koomey sees the same pattern emerging as Digiconomist's data and other estimates weave their way into research reports and news articles, sowing the type of faulty conventional wisdom that could mislead investors.
Take for example the prediction that bitcoin mining's electricity usage will match U.S. power consumption in 2019 — and the world's total appetite by 2020 — if it continues to grow at its current pace. That analysis is based on Digiconomist's estimate and originated in a recent fact sheet by Power Compare, a British website that offers electricity information.
source: Power Compare
According to Koomey, this kind of analysis makes a classic mistake: It projects high growth rates associated with a new technology into the future, resulting in an eye-popping demand forecast. Similar projections were made about internet data traffic and electricity usage from office computers and mobile devices, he notes. Sure enough, their initial growth rates moderated as they scaled up.
De Vries also said the Power Compare forecast based on his estimate is unrealistic.
Still, in the following weeks, the analysis spread quickly. It was featured in a Grist article earlier this month titled "Bitcoin could cost us our clean-energy future" and a week later in a Newsweek story headlined "Bitcoin mining on track to consume all of the world's energy by 2020."
Also last week, financial newsletter The Bear Traps Report cited the analysis speculating that GE's turbine business could benefit as China switches from coal-fired to natural gas generation in part to support cleaner-burning bitcoin mining. However, the financial newsletter did call it an "extreme" case.
Druckenmiller told CNBC last week he doesn't own bitcoin and only trades what he knows, adding, "What I do know is it takes the same amount of energy to do one bitcoin transaction that it takes to power nine homes in the U.S. By 2019 it'll take up half the energy in the United States to run the bitcoin network."
The statistic comparing energy usage by U.S. homes and bitcoin mining also comes from Digiconomist. The other reports also relied heavily on Digiconomist data on top of the Power Compare analysis.
It's not yet clear what will rein in bitcoin's growing energy usage. Researchers say it could be the rise of cryptocurrencies with mining protocols that require less energy, a crash in bitcoin prices, continued efficiency gains as bitcoin scales up or a combination of these and other developments.
It's also possible that bitcoin mining will become less attractive as it becomes less profitable. Currently, bitcoin's coding yields about 12.5 coins every 10 minutes, but that yield falls by half every four years. That means profit margins will get slimmer if mining costs don't fall by 2020, when the next drop is scheduled.
Even if the Digiconomist figures are correct, Koomey notes that power consumption from bitcoin mining would only amount to a fraction of 1 percent of global demand. He and others caution against making leaps about bitcoin's impact on the power sector until verifiable data are available.
"Companies who make big investment decisions based on numbers that are highly uncertain are almost always going to get burned. It's just a mistake to jump to conclusions," Koomey said.