As Bitcoin grows, the level of power consumption needed to mine grows too. This is an area which is also receiving increasing attention. A new study published in the American Journal of Energy Academics Joule claims that by the end of 2018, Bitcoin network’s power consumption may account for 0.5% of the global total.
Currently, on average, every 10 minutes a new block on the Bitcoin network is created or “mined”, and the user who obtained the newly generated block is rewarded with 12.5 Bitcoin. This is the process known as “mining” and is the root of the energy consumption issue surrounding Bitcoin. At present, the price of one Bitcoin is about $8,300 US so the desire to mine is popular. Powering the machines which require vast CPU’s to mine (and can be on 24/7) is an expensive and energy draining feat.
According To Alex De Vries
In an article written by PwC’s data consultant, Alex de Vries, the Bitcoin expert said that the current Bitcoin network consumes at least 2.55 GW of electricity. This is about the same as the entire electricity consumption in Ireland. The amount of electricity used in a Bitcoin transaction is approximately equal to an average household in the Netherlands’ electricity consumption in one month.
The article believes that by the end of 2018, Bitcoin’s network power consumption may reach 7.7 GW, which is similar to Austria’s national power consumption level and this amount would account for 0.5% of the world’s total power consumption.
Alex de Vries explained that a half-percentage point is very alarming and in comparison, the energy consumption currently needed for the fiat financial system, doesn’t compare.
This kind of energy consumption is certainly not conducive to solving the global warming crisis.
He estimated that if Bitcoin prices rise, people will invest in more computers in order to mine more Bitcoins, and the result will be more energy consumed. If Vries expectations are met, then that figure could easily grow from 0.5% to 5% in the years to come. What response will we have for climate change then?
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