Bitcoin mining consumes as much energy as the country of Ireland

Desdemona Despair

By Paris Martineau
16 May 2018

(The Outline) – In addition to being insufferable, Bitcoin is also absolutely terrible for the environment. According to a letter published today in the energy journal Joule by financial economist and blockchain specialist Alex de Vries, the Bitcoin network is consuming roughly 2.55 gigawatts annually, at the absolute minimum. To put that in context, that’s nearly the same amount of energy consumed by the entirety of Ireland. That’s just the conservative current estimate; De Vries predicts that by December, the Bitcoin network could be using almost triple that.

Bitcoins cost energy to “mine,” because mining is just a computer running calculations; the longer Bitcoin is around, the more energy it takes to mine each subsequent unit (it takes four times as much energy to mine a single Bitcoin now as it did when the currency launched in 2009). There is a finite amount of Bitcoin, and the most recent projections show it will take about another 120 years to mine all 21 million Bitcoins. There is also, theoretically, a tipping point somewhere in there where the amount of energy it takes to mine a piece of Bitcoin is more valuable than the Bitcoin itself, though it all depends on the market value. But Bitcoin transactions, not just mining, require electricity (one transaction could currently power a home for a week), so the more widely used it is, the more carbon we are pumping into the atmosphere.

There’s been a considerable amount of debate over the last couple of years surrounding the extent of the energy impact of Bitcoin (for instance, is it pretty bad, or really really bad?), not least because energy use in most parts of the world contributes carbon dioxide to the atmosphere, which contributes to climate change. But in the wake of Bitcoin’s wild valuation ride throughout most of 2017 up to nearly $20,000 per coin, cryptocurrency mining doesn’t seem likely to slow down anytime soon. Researchers need concrete answers before it becomes far too late enact institutional restrictions and regulations on the practice, writes De Vries. 

De Vries’ figure doesn’t even include the energy expenditures of other popular cryptocurrencies like Ethereum and Ripple. The altcoin market’s potential for comparably sky-high energy consumption levels is unfortunately all too serious. According to the Digiconomist’s Ethereum Energy Consumption Index (which is technically still in beta), Ethereum production already makes up .09 percent of the world’s total energy consumption. While this may seem like a relatively small amount, it’s not. It’s already more than the total yearly energy consumption of countries like Iceland, Jordan, and Cuba. And given that Ethereum is only just getting started (ugh), this figure will likely only rise. [more]

Bitcoin is consuming as much energy as the country of Ireland

ABSTRACT: The electricity that is expended in the process of mining Bitcoin has become a topic of heavy debate over the past few years. It is a process that makes Bitcoin extremely energy-hungry by design, as the currency requires a huge amount of hash calculations for its ultimate goal of processing financial transactions without intermediaries (peer-to-peer). The primary fuel for each of these calculations is electricity. The Bitcoin network can be estimated to consume at least 2.55 gigawatts of electricity currently, and potentially 7.67 gigawatts in the future, making it comparable with countries such as Ireland (3.1 gigawatts) and Austria (8.2 gigawatts). Economic models tell us that Bitcoin’s electricity consumption will gravitate toward the latter number. A look at Bitcoin miner production estimates suggests that this number could already be reached in 2018.

Bitcoin’s Growing Energy Problem