Why Bitcoin Mining Requires a Lot of Energy

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Many people have criticized Bitcoin mining is an energy-intensive process with significant environmental impacts. 

Bitcoin mining is one of the most popular ways to make money with this virtual currency. Miners earn a designated amount of Bitcoin to verify transactions on the blockchain and generate new tokens for circulation. However, mining cryptocurrency is not as simple as it may sound. Bitcoin miners compete to solve cryptographic puzzles, and only the individual or group that finds the solution first receives the rewards. It is complex to predict Bitcoin’s price movements when trading on exchange platforms such as bitcoin-pro.live since they provide consistent market analysis.

Mining Bitcoin requires proper computational skills since the calculations are beyond human capabilities. Although you can still mine Bitcoin on Android devices, they are usually inefficient compared to the modern ASIC mining rigs. Thus, profitable Bitcoin mining also requires investing in powerful and specialized computer hardware and software. Nevertheless, here’s what you should know to determine why Bitcoin mining is energy-intensive. 

Bitcoin’s Energy Consumption 

Industry reports show Bitcoin mining accounts for about 0.5% of the world’s total energy consumption. As one expert says, that is about seven times more than the amount of energy that Google uses to run its global operations annually. Mining Bitcoin takes up about 91 terawatt-hours of electricity or 116 trillion watts per year. That is more than the annual electricity consumption of countries like Finland, which has 5.5 million people. 

Many studies show the amount of electricity used to mine Bitcoin has increased by almost ten times from five years ago. Today, Bitcoin mining consumes more than a third of the electricity used for residential cooling in the United States annually. While it is challenging to measure the exact amount of energy that Bitcoin mining consumes, the above statistics can help you put things into perspective. 

Why Bitcoin Mining Is Consuming A lot of electricity 

Bitcoin is a decentralized currency without any governing authority to oversee transactions. Instead, its blockchain network comprises thousands of random nodes (independent computers), each with an accurate record of all Bitcoin transactions to prevent theft and fraud. The computers on the network must verify the transaction every time someone sends Bitcoin to another. 

Powerful Computational Hardware 

Miners compile the transactions in groups or blocks every ten minutes. A miner gets new Bitcoins as the reward for solving the cryptographic puzzle or finding a unique key and adding the blocks to the blockchain. Miners currently receive 6.25 BTC for every transaction. The unique key is an algorithm-generated 64-digit hexadecimal number (hash, less than or equal to the target hash upon which miners add the previous block to the blockchain. 

Those calculations require mighty and specialized computational equipment with robust servers. ASICs are the most prominent Bitcoin mining hardware today that can generate thousands, millions, and even billions of hashes per second. Thus, running the equipment even for a single day can take up vast amounts of electricity. 

The Odds Favor Constant Mining 

Mining Bitcoin is quite different, requiring miners to use trial and error to solve the cryptographic puzzles. That means computers must constantly run to give miners the best chance to find the unique key, verify the latest transactions, and receive the rewards. 

Bitcoin’s constantly growing value has incentivized many people to become miners, resulting in more mining rigs and increasing energy consumption. Besides, the difficulty of solving each cryptographic puzzle increases as the network expands. That makes it imperative for miners to engage in Bitcoin mining constantly, increasing energy consumption significantly. 

Crypto mining is undoubtedly an energy-intensive process, responsible for most of Bitcoin’s environmental impacts. The process mainly consumes a lot of electricity due to the powerful hardware used and the need for miners to engage in mining constantly. 

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