New Study Estimates Bitcoin Could Consume 7.7 gigawatts Before the End of 2018
The Bitcoin network is run by miners, computers that maintain the shared transaction ledger called the blockchain. Energy consumption required to mine Bitcoin may soon become too expensive for cryptocurrency mining to become profitable.
A new study estimates that cryptocurrency mining can consume as much as 2.6GW of power, almost as much electric power as Ireland consumes. This figure could rise to 7.7GW before the end of 2018 accounting for almost half a percent of the world’s electricity consumption.
At this point, mining Bitcoin requires such intense and specific hardware that the only way for most people to get in on the crypto game is to simply buy the currency through an exchange. But that doesn’t mean mining has slowed down.
Bitcoin mining requires energy to perform the calculations, hash, that give the miners Bitcoin rewards. In mid-February, it was reported that crypto mining in the country of Iceland would consume more energy than households in 2018. The debate over whether Bitcoin mining is overly harmful for the environment is seen by some as a non-issue, due to the real need for Bitcoin in under-banked countries.
So much energy is required in mining due to the decentralized nature of Bitcoin. Because the cryptocurrency depends on a point-to-point network to keep records of transactions, energy is needed to power large distributed networks of computers.
As de Vries makes clear in his new paper, these numbers are necessarily speculative. Bitcoin mining is a decentralized and secretive industry. We know how much computing power the bitcoin network has right now it’s about 30 million trillion SHA-256 hashes per second. But miners are making these calculations on different types of hardware with different levels of energy efficiency, so we can’t convert that figure directly to energy consumption.
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