For all the positive news on cryptocurrencies, there are also negative sides that should not be concealed. And electricity usage for bitcoin mining is a huge problem. Experts call for more commitment in sustainability. Bitcoin mining uses more energy than subsidies of gold or copper. The industry is working on new approaches.
Only aluminum production costs more
The production costs for raw materials such as gold or platinum have increased significantly in recent years. Since we are talking about limited resources, this is only natural. Scientists have now compared the power consumption of bitcoin mining to the cost of mining gold and other metals. The result shows why many mining farms are now looking for environmental friendly options, and increasingly relying on sustainably generated energy. Canada has become an important location for this.
The study, published in the journal Nature, researched how much electricity is needed to create the value of one dollar US. The study showed that the cost of aluminum mining is higher than that of bitcoin mining. Copper, gold and platinum however can be mined cheaper.
Bitcoin relies on very large amounts of energyRecent surveys suggest power
Studies estimate worldwide energy consumption of bitcoin mining at about 73 billion kilowatt-hours, and at about 20 billion kWh for Ethereum. This is about the volume of hard coal that was produced 2017 in Germany. Researchers at the University of Hawaii are currently considering that Bitcoin will even make a significant contribution to climate change, should miners not finally rely more on new technology concepts within the blockchain. High levels of computation needed to validate transactions consume large volumes of electricity worldwide and are the biggest problem.
Many developers are working on energy-saving concepts
But there is hope. Several approaches could soon lead to a significant reduction in energy requirements. The fact that blockchain companies are increasingly using electricity from renewable energies is an important first step. Experts point out that within the blockchain databases, there is potential for a reduction in consumption. Switching to a “proof-of-stake” model could already significantly reduce the power requirement. New hybrid concepts allow for more transactions to be carried out at the same time.