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I'm wondering, doesn't the blockchain expend vast amounts of electrical energy to do artificial work just to keep the system credible? And as the capitalization grows, energy consumption grows with it? Isn't this a problem for scalability? For context, bitcoin is 9 billion dollars, global fiat money is somewhere between 30 and 70 trillion dollars.

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Yes, that could be a problem for proof-of-work blockchains. Private blockchains (with different threat models) can use algorithms like PBFT that don't spend appreciable energy.

it does, it doesn't have to

the network expends vast amounts of electrical energy because people are competing to earn bitcoin from that network. they will even do it at a loss because bitcoin is 9 billion dollars, and can be between 30 and 70 trillion dollars.

if they turned off their machines it would spend less energy on aggregate, and the system would be just as credible, because I would turn my machines on.

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