Bitcoin Mining Outranks Entire Countries in Energy Consumption
Cryptocurrencies and blockchain have experienced a significant increase in public interest this year, with the price of bitcoin cresting $15,000 on December 7, 2017.
Massive Amounts of Energy
As bitcoin continues to send the world into a frenzy, many people are scrambling to get in on the action through bitcoin mining.
According to Blockchain’s mining statistics, the total mining revenue in the 24 hours prior to writing this article was equal to $33,809,087.74. While it is unknown exactly how many miners there are in operation, the cost of bitcoin mining in terms of electricity usage supersedes the amount used by 159 individual countries.
At this stage, officials have measured that the global mining network needs over 30 terawatt-hours of electricity to operate.
Bitcoin mining is the term used for the process of solving complex mathematical calculations, an activity which the network rewards in bitcoins.
Each calculation approves a transaction made on the bitcoin network, gradually adding blocks to the blockchain, which is a public record of every transaction which took place since the introduction of bitcoin in January 2009.
As time progresses and bitcoin evolves into each new stage, the transactions become more complicated to solve. In turn, the systems requirements for the efficient processing of these operations will increase, as well as the electricity needed to power the mining machines.
Miners are thus responsible for securing the system and bringing new bitcoins into circulation.
As the cost of electricity becomes a crucial factor in the profitability calculations of bitcoin mining, many miners opt to base their operations in countries with reduced energy costs.
That being said, even if bitcoin was to drop in value, there is no guarantee that the amount of energy used by miners will decrease. Apart from bitcoin, there are several other cryptocurrencies such as Litecoin, SafeCoin, and Ethereum which miners will continue to chase as mining machines whirr away in their warehouses and homes.
Cost of Returns is Multi-layered
Bitcoin is solving huge problems. At once, citizens of unstable governments are funded with cryptocurrency, the potential upheaval of the current remittance market, and measuring the innovative groundwork for the rise of other markets like Ethereum and Monero must all be considered.
On a more micro level, some miners report eccentric benefits of running mines in their homes. One miner in North Carolina shared recently that his two bitcoin and two Ethereum machines warm his house so much that he hasn’t needed to pay for heat in three years.
It is not always a benefit, however. Radhi Fakhoury states that he does not run his machines on summer days with temperatures exceeding 90˚F, as the cost of keeping them cool would come close to outweighing the profits made during that time.
Discussions like this go back and forth, but the market is now clamoring for some eco-alternatives. Fortunately businesses like HydroMiner and Chia are exploring the space. Hopefully they provide some solutions in the coming months.