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Author Topic: Power consumption of Bitcoin mining  (Read 1049 times)
BIRC (OP)
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May 18, 2018, 04:04:23 AM
 #1

Today I read this article.....

https://www.ccn.com/bitcoins-electricity-usage-could-power-all-of-austria-in-the-future/

It says in 2018 Bitcoin mining may consume 0.5% of world’s electricity in 2018.
I think this is because the mechanism "PoW" of Bitcoin. It costs a lot of power. And it looks like this statistics only includes Bitcoin, but there are still other coins can be mined.
I am sure for some people this is not environment-friendly and this could be used as the reason to restrict Bitcoin.

Will this affect the future of Bitcoin? or will there be any new energy-saving mining method for Bitcoin or other coins? How do you think about this?

butka
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May 18, 2018, 05:15:04 AM
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 #2

If you take the energy that is being used (wasted) today by the highly inefficient banking system and compare it to the energy
consumed during the process of mining bitcoins, you will quickly find out that the energy spent in the mining process is not that large.
So I think articles like the one you've linked are misleading. Before blaming Bitcoin, the journalist should start by analyzing the current energy
costs in the highly bloated financial sector (which is something we accept as normal, but it is far from normal).
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May 18, 2018, 05:26:00 AM
 #3

If you take the energy that is being used (wasted) today by the highly inefficient banking system and compare it to the energy
consumed during the process of mining bitcoins, you will quickly find out that the energy spent in the mining process is not that large.
So I think articles like the one you've linked are misleading. Before blaming Bitcoin, the journalist should start by analyzing the current energy
costs in the highly bloated financial sector (which is something we accept as normal, but it is far from normal).

I agree with you on this one. To start off the article with: "Bitcoin's burgeoning electricity demands have attracted almost as much attention as the cryptocurrency's wildly fluctuating value" seems a little intimidating for someone who's just now reading about BTC. Burgeoning makes it seem like it's a big hassle (which it is, but it shouldn't have as much of a negative connotation since it's essentially free money). Furthermore, I really don't think the electricity costs gather nearly as much attention as the actual value of the coin. That's essentially the writer not knowing enough about Bitcoin if not a pure lie.

This area is up for grabs! PM me if you're interested.
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May 18, 2018, 05:26:11 AM
 #4

There is no law that forbids you to use electricity for your own purposes.
And imagine that instead of the asics are the machines for the production of parts?
Do they also consume energy, should they be limited now?

You just need to use alternative energy sources.
But many heads of state are idiots and do not want to allocate money for this and a vicious circle turns out.

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May 18, 2018, 05:27:12 AM
 #5

I think this is because the mechanism "PoW" of Bitcoin. It costs a lot of power. And it looks like this statistics only includes Bitcoin, but there are still other coins can be mined.

I am sure for some people this is not environment-friendly and this could be used as the reason to restrict Bitcoin.

So there's Proof of Stake as alternative the current Proof of Work mining for Bitcoin, are you saying that POS will require less electricity? The POS process still requires that miners run machines, they're just getting paid differently...they're not getting paid by the blocks awards, but by the transaction fees. Mining machines still need to confirm those transactions


Will this affect the future of Bitcoin? or will there be any new energy-saving mining method for Bitcoin or other coins? How do you think about this?

I don't think it'll affect the future, however if a Bitcoin miner refines alternative energy in their pursuit of lowering costs it'll help the world in incredible ways.
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May 18, 2018, 05:33:17 AM
 #6

Mining is essential to blockchain and it makes a good profit to all miners despite the power required to operate a bitcoin mining rigs. Some countries used a natural ways of providing stable and cheap price electricity and that gives them advantage to obtain good profit from mining.

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May 18, 2018, 08:06:03 AM
 #7

To mine the bitcoin is very much needed electricity to use, but I think there will be a way to mine another coin that is more power efficient.
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May 18, 2018, 08:11:44 AM
 #8

This fact will affect bitcoin and the opinion of States about it. China is already going to try to limit mining, as this is really a very large amount of electricity. Let's see. Most likely, positive from this is not to be expected.
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May 18, 2018, 09:26:59 AM
 #9

Today I read this article.....

https://www.ccn.com/bitcoins-electricity-usage-could-power-all-of-austria-in-the-future/

It says in 2018 Bitcoin mining may consume 0.5% of world’s electricity in 2018.
I think this is because the mechanism "PoW" of Bitcoin. It costs a lot of power. And it looks like this statistics only includes Bitcoin, but there are still other coins can be mined.
I am sure for some people this is not environment-friendly and this could be used as the reason to restrict Bitcoin.

Will this affect the future of Bitcoin? or will there be any new energy-saving mining method for Bitcoin or other coins? How do you think about this?



This has already been tackled numerous times on this forum. Many people think that switching to PoS = going greener and lower power consumption. While that may be true, it still pose a risk on the general network since those with higher balances would be the ones generating more bitcoins that could potentially be slammed in the market. There are both pros and cons to either of the algorithm, but why fix something that isn't broken? Mining operators surely know what's up, and some are already going green by using renewables to generate electricity. I'm sure in a couple year's time, many will convert to greener approach towards mining given that there are already countries spearheading the initiative.
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May 18, 2018, 09:31:38 AM
 #10

If you take the energy that is being used (wasted) today by the highly inefficient banking system and compare it to the energy
consumed during the process of mining bitcoins, you will quickly find out that the energy spent in the mining process is not that large.
So I think articles like the one you've linked are misleading. Before blaming Bitcoin, the journalist should start by analyzing the current energy
costs in the highly bloated financial sector (which is something we accept as normal, but it is far from normal).

For the sake of counter argument, the energy consumed by the inefficient banking system and gold mining can be compared with that of Bitcoin mining, there is a substantial difference. There was an article published on Hackernoon, The Bitcoin vs Visa Electricity Consumption Fallacy:

Quote
Let’s add to the mix the electricity consumption of the branches. According to the World Bank there are 12.5 branches per 100,000 adults in the world so if the world population is 7.6 billion people and we have around 70% adults, this means a total of 665,000 branches. Only in the US they appear to be close to 100,000 branches and assuming US is around 15% or less of the entire banking system worldwide you get to around the same number.
So total consumption for banks during a year only on those three metrics is around (I am rounding) 26Twh on servers, 58Twh on branches and 13Twh on ATMs for a total of close to a 100 Twh a year.

According to the article that trigger this discussion, Bitcoin annual Twh consumption is 28.67 , so currently more than 3 times more efficient than a very conservative calculation of the cost of the global banking system.
Of course you will argue that the banking systems does more than handling a currency which is true but the difference is large enough that I do not think is that relevant. Even if only 30% of banks electricity consumption was the comparable part to Bitcoin, that will still make Bitcoin more efficient.

Rough estimates, Bitcoin adoption is still around 1%, comparing the current energy consumption of Bitcoin with that of global banking system doesn't make much sense and if I go by the figures in this article, 28.67 Twh with around 1% adoption and as adoption increases, I don't think it would be wrong to assume that with about 10 to 15% adoption, the Bitcoin energy consumption would be more than that of the global banking system.

Bitcoin does have an energy efficiency problem. Don't know how effective a solution LN would be, but as Andreas Antonopoulos points out in a YouTube video, the solution lies in a significant growth in renewable/alternative energy sector/establishing mining operations on locations with surplus energy.

Quote
Proof-of-work mining is contributing to massive investment and subsidy in renewables / alternative energy and efficiency improvements in processing. It is driving the decentralization of energy production.

https://hackernoon.com/the-bitcoin-vs-visa-electricity-consumption-fallacy-8cf194987a50

https://youtu.be/2T0OUIW89II
butka
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May 18, 2018, 09:47:55 AM
 #11


For the sake of counter argument, the energy consumed by the inefficient banking system and gold mining can be compared with that of Bitcoin mining, there is a substantial difference. There was an article published on Hackernoon, The Bitcoin vs Visa Electricity Consumption Fallacy:

Quote
Let’s add to the mix the electricity consumption of the branches. According to the World Bank there are 12.5 branches per 100,000 adults in the world so if the world population is 7.6 billion people and we have around 70% adults, this means a total of 665,000 branches. Only in the US they appear to be close to 100,000 branches and assuming US is around 15% or less of the entire banking system worldwide you get to around the same number.
So total consumption for banks during a year only on those three metrics is around (I am rounding) 26Twh on servers, 58Twh on branches and 13Twh on ATMs for a total of close to a 100 Twh a year.

According to the article that trigger this discussion, Bitcoin annual Twh consumption is 28.67 , so currently more than 3 times more efficient than a very conservative calculation of the cost of the global banking system.
Of course you will argue that the banking systems does more than handling a currency which is true but the difference is large enough that I do not think is that relevant. Even if only 30% of banks electricity consumption was the comparable part to Bitcoin, that will still make Bitcoin more efficient.

Thanks for this reference to the consumption power estimates. I thought the numbers would be more in favor of Bitcoin.

Rough estimates, Bitcoin adoption is still around 1%, comparing the current energy consumption of Bitcoin with that of global banking system doesn't make much sense and if I go by the figures in this article, 28.67 Twh with around 1% adoption and as adoption increases, I don't think it would be wrong to assume that with about 10 to 15% adoption, the Bitcoin energy consumption would be more than that of the global banking system.
But this is under the assumption that Bitcoin's power consumption will grow linearly with adoption. I wonder why that would be the case? Isn't the current mining power enough to handle 10 or 15 times the number of users? 
B4RF
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May 18, 2018, 09:53:25 AM
 #12

This topic comes up frequently and there are some arguments I can agree with which are regular responded.

1. The current fiat system consumes much more energy. Besides the power consumption for a payment-processing systems you also need to consider that the current system consumes energy for building banks etc.

2. bitcoin mining takes place in regions with low energy costs (most likely equivalent to a power surplus) which prevents the need of energy transportation/conversion which would lead to a percentage of energy being wasted.

3. The generated heat from the mining can be used which would make the energy not totally wasted and benefits the one using the mining equipment as heater because of the mining reward. Example:http://www.cbc.ca/news/canada/manitoba/bitcoin-mining-greenhouse-fish-farm-1.4470295


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May 18, 2018, 09:54:43 AM
 #13

Today I read this article.....

https://www.ccn.com/bitcoins-electricity-usage-could-power-all-of-austria-in-the-future/

It says in 2018 Bitcoin mining may consume 0.5% of world’s electricity in 2018.
I think this is because the mechanism "PoW" of Bitcoin. It costs a lot of power. And it looks like this statistics only includes Bitcoin, but there are still other coins can be mined.
I am sure for some people this is not environment-friendly and this could be used as the reason to restrict Bitcoin.

Will this affect the future of Bitcoin? or will there be any new energy-saving mining method for Bitcoin or other coins? How do you think about this?


That will not affect the future of Bitcoin. Although it consumes a significant amount of electricity to exploit Bitcoin, there are very few businesses that do. In addition, if the amount of electricity lost is too great, the government will offer a more reasonable price to minimize this.
So you do not have to worry too much about it. Wink

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May 18, 2018, 10:02:39 AM
 #14

Watch this to understand:
https://www.youtube.com/watch?v=2T0OUIW89II

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May 18, 2018, 10:28:30 AM
 #15

"how much" power bitcoin mining consumes has never mattered. it can be any amount and rise to any amount such as the 0.5% they are speculating. all that matters is the utility that bitcoin is providing us. and as long as this usefulness is available the power is being consumed in a constructing way.

if anyone wants to nag then they have to nag about the power consumption of all these useless altcoins which are waste of power and space.

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May 18, 2018, 12:22:12 PM
 #16

...
I think this is because the mechanism "PoW" of Bitcoin. It costs a lot of power. And it looks like this statistics only includes Bitcoin, but there are still other coins can be mined.
I am sure for some people this is not environment-friendly and this could be used as the reason to restrict Bitcoin.
...


I´d like to direct you to this thread where I outlined a few reasons why the
waste of energy argument against Bitcoin is stupid:

Debunking the waste of energy argument against Bitcoin

Other users added their own arguments as well and the whole thread is definitely worth a read!

From the article that you linked:
Quote
Sometimes the best information we’ve got is really shaky eyewitness accounts. That’s the stuff we have to work with.

If this is indicative of the quality of the data that de Vries used for his analysis
his calculations are completely useless and not to be trusted. Besides, he erroneously believes
that large amounts of desktop computers are still used for Bitcoin mining when in reality
it is 100 % ASICs as of today, because ASICs are simply too much ahead in terms of computing
power for this specific task (all botnets that mine cryptocurrencies on the affected computers
mine other coins (e.g. Monero) and not Bitcoin where ASICs are ubiquitous).


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May 18, 2018, 12:25:59 PM
 #17

If you take the energy that is being used (wasted) today by the highly inefficient banking system and compare it to the energy
consumed during the process of mining bitcoins, you will quickly find out that the energy spent in the mining process is not that large.
So I think articles like the one you've linked are misleading. Before blaming Bitcoin, the journalist should start by analyzing the current energy
costs in the highly bloated financial sector (which is something we accept as normal, but it is far from normal).

Thank you butka, a fantastic rational reasoning. FUD is so easy to make because people rarely use reason when thinking about what they read.
If someone said that the Earth was plain, a lot of people would start believing it... oh wait, someone did, and - yes they did.

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May 18, 2018, 12:38:05 PM
 #18

or will there be any new energy-saving mining method for Bitcoin or other coins? How do you think about this?

the only energy saving will be less mining competition and it's hard to say whether that'll happen in our lifetimes.

hopefully more miners will head to places like iceland where the power is geothermal and basically limitless.

i don't care what anyone else says, i think it is a crazy waste of resources. the number of actual users is maybe 0.1-0.5% of banking and gold users.
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May 18, 2018, 01:38:20 PM
 #19

Rough estimates, Bitcoin adoption is still around 1%, comparing the current energy consumption of Bitcoin with that of global banking system doesn't make much sense and if I go by the figures in this article, 28.67 Twh with around 1% adoption and as adoption increases, I don't think it would be wrong to assume that with about 10 to 15% adoption, the Bitcoin energy consumption would be more than that of the global banking system.
But this is under the assumption that Bitcoin's power consumption will grow linearly with adoption. I wonder why that would be the case? Isn't the current mining power enough to handle 10 or 15 times the number of users? 

There is a correlation between Bitcoin price and hash rate. Even though Bitcoin price is around $8000 now the hash rate hasn't dropped, it is same or a bit more than what it was when Bitcoin was around $20000. Declining price/hashrate correlation is a bit complex, resistance level. But when you assume that the rate of adoption is going to increase by 10 or 15 times, then definitely the price would increase and here there is no complexity, direct correlation, hashrate following price, the higher the price in USD, miners who stopped mining because it was unprofitable would again deploy their ASICs/new miners, more energy consumption.

Let's assume hashrate, difficulty, blocksize are internal factors, fixed and correlating, price and adoption are external factors then I guess the current mining power is enough to handle 10 or 15 times the number of users. The internal factors adjust to changes in Bitcoin price/rate of adoption. From the security perspective, adoption/increase in network usage would lead to an increase in hashrate to secure the network.
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May 18, 2018, 02:00:27 PM
 #20

Rough estimates, Bitcoin adoption is still around 1%, comparing the current energy consumption of Bitcoin with that of global banking system doesn't make much sense and if I go by the figures in this article, 28.67 Twh with around 1% adoption and as adoption increases, I don't think it would be wrong to assume that with about 10 to 15% adoption, the Bitcoin energy consumption would be more than that of the global banking system.

Bitcoin does have an energy efficiency problem. Don't know how effective a solution LN would be, but as Andreas Antonopoulos points out in a YouTube video, the solution lies in a significant growth in renewable/alternative energy sector/establishing mining operations on locations with surplus energy.

Comparing usage is going to turn pretty ugly for BTC.
You are saying "adoption" but that can't be really measured, what if we switch to usage?

So we have 25Twh for 200k daily transactions via BTC and 100Twh for an estimate of 2 billions transactions for the banking sector.
Of course we're excluding LN, the fact that one transaction can mean 100 poeple are getting payed but still...
In terms on energy consumption the banks win it right now by 500-1000 times.

But this is under the assumption that Bitcoin's power consumption will grow linearly with adoption. I wonder why that would be the case? Isn't the current mining power enough to handle 10 or 15 times the number of users? 


Mining power has nothing to do with number of users.
The "problem" is the reward gained by mining each block, if the reward is 100$ people will spend 90$ on electricity and take 10$ profit, if BTC skyrockets to 100 000$, then we're going to have a daily reward of 180 millions $ !!! and miners might consume 150 millions worth of energy daily and get the rest in profits.
And beyond that number things get really really scary.


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