Do you know that bitcoin mining consumes around 128.77 terawatt-hours (TWh) per year? And is it likely to fall unless the value of the coin collapses? Cryptocurrency mining consumes a great deal of energy with computers and heavy machines, leaving a destructive impact on the entire world.
Mining is the process that involves the verification of transactions on the blockchain without relying on a central authority. Mining computers thrive by solving complex problems, and those calculations require a great deal of power. There is a reward with freshly mined coins and transaction fees once the bitcoin miners solve this problem.
According to the University of Cambridge, Bitcoin currently represents 0.59% of the world’s total energy consumption. Digiconomist estimates that the grid’s energy consumption is reaching 82,026, which is, according to the site, comparable to the energy consumption of Chile. Since the beginning of 2020, the energy consumption of Bitcoin has increased by up to 80% amid an immense evolution in digital currencies.
Let us know in depth the enormous energy consumption and its adverse impact on environmental sustainability.
Massive electricity consumption
The University of Cambridge suggested that bitcoin mining consumes more electricity compared to electricity consumption in Argentina. According to online tools, bitcoin’s electric power consumption is higher than that of Argentina, that is, 121TWh, the United Arab Emirates, the Netherlands, that is, 108.8 TWh, and is currently approaching Norway, it is say, 122.20 TWh.
Specialized computers are connected to cryptocurrency networks to mine. Its main job is the verification of transactions that send or receive bitcoins. This process includes solving complex problems, providing an obstacle to security to combat fraudulent activities. Furthermore, critics claim that tesla’s decision to invest a considerable amount in bitcoin. This week, the value of the coin reached the figure of $ 48,000 and according to tesla’s announcement, it has raised up to $ 1.5 billion in bitcoins and plans to accept it as a payment method in the coming years.
According to the third global cryptoassets benchmark study, 28% of the total energy consumed by crypto mining comes from renewable resources. People often interconnect a large number of miners to the network to make huge profits. That uses an unexpected amount of electricity because computers are working more or less continuously to solve puzzles. It is possible to estimate how much electricity is consumed at a time by considering the energy demand for the bitcoin network and the average price of electricity per kilowatt hour ($ 0.05).
What do Bitcoin mining experts have to say?
Let’s get a deep look at what bitcoin mining experts have to say about the alarming power consumption of bitcoin mining, which is currently progressing by leaps and bounds.
# 1 Dan Held
Cryptocurrency exchange Kraken’s growth chief Dan Held proclaims that the bitcoin network has been unjustifiably targeted by those who claim that bitcoin is taking its power consumption irrationally.
Dan Held stated that:
“What it really comes down to when people argue that they don’t like bitcoin power consumption is that they actually don’t like bitcoin. People who are not in favor of cryptocurrencies anticipate that the energy consumption of bitcoin mining is a waste. “
Dan Held emphasizes the fact that everything in this world requires energy consumption, and with advances in technology, the amount of energy required to power that technology faces immense growth in the near future. Almost everything in our lives uses energy. Claiming that one source of energy use is less wasteful than others is absolutely subjective, since all uses have paid market rates to use that energy.
# 2 Thillainathan
Thillainathan told business experts that more power consumption is required as the bitcoin network grows and at the same time, the profitability of mining increases. As a mine operator, he affirms that minors must take into account the environmental enigma during the mining process since energy consumption can have a negative impact. He hopes that bitcoin mining will be beneficial as bitcoin prices rise in the market, and more miners should consider using renewable energy resources with this next revolution.
He stated in front of Insider that:
“Being a firm believer in bitcoin, it is an efficient way to store wealth, but being an infrastructure provider, it is an imperative that we are required to be as environmentally friendly as possible.”
Thillainathan claimed that the energy used during mining is called “dirty energy” and, unfortunately, the energy is not sustainable in the long term. He claims that one day the government will crack down on the use of coal plants.
# 3 Mason Jappa
Blockchain Solutions CEO Mason Jappa, who also works as an operator of some of the largest mining rigs in the United States, claims that bitcoin miners are financially incentivized to operate on the cheapest electricity possible, often concluding They use energy that would have been rendered useless.
Mason Jappa tweeted that,
“Bitcoin mining improves energy efficiency and simultaneously reduces kWh energy rates for the population through reduction agreements, ceasing energy consumption during peak hours, targets renewable energy, improves energy technology and reduces burning natural gas. “
Jappa claims that the US mechanisms are powered by a process called “gas flare recapture.” A piece of gas burns in the air when natural gas is extracted. Bitcoin miners prevent it from being released into the air and capture that flash for energy utilization.
Environmental impact is thriving in parallel with the rise and prominence of bitcoin. There would be no question in saying that cryptocurrency mining requires an enormous amount of energy. According to the latest analysis of data by Cambridge on energy consumption of bitcoins (CNBC), this energy consumption could alarm Treasury Secretary Janet Yellen.
Yellen said that:
“It is the most incompetent method of transacting, and the amount of energy consumed during the mining process is staggering.”
Additionally, CAGF explained that:
“The more machines operate for mining, the more possibilities there are to solve complex problems. However, more machines in operation means more energy consumption, which raises the question of the cost of miners. “
CCAF claims that they do not have enough data to support the determination of the carbon footprint of the crypto solution. Therefore, the main concern is the increasing energy consumption of bitcoin mining and the threats it is posing to the United Nations Sustainable Development Goals in the coming years. In addition, it is a great concern to face the climate crisis.
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