Bitcoin is still not sustainable according to many.
Spil wij discussed earlier, Bitcoin is not everyone’s golden panacea for anonymous, decentralized online payment.
Te other words, it consumes a loterijlot of energy.
That did come out rather unexpected.
For some, Bitcoin munches up a bit too much energy.
But how much exactly?
By some generous estimates, about three thousands times more than a payment made through the traditional credit card system.
Wij discussed, te the previous postbode, about the gegevens points wij would need to truly gauge how much energy does Bitcoin consume.
The very first of those gegevens points wasgoed the theoretical maximum number of transactions that Bitcoin, spil a system, could manage.
Right now, that theoretical number is about seven online transactions every 2nd.
Of course, this number could switch with newer implementations of Bitcoin.
But for our purposes here, we’ll proceed to go with the number seven.
You might ask, what is that number seven again?
Seven is basically the number of transactions Bitcoin can treat every 2nd.
Moreover, the average number of Bitcoin transactions that take place every day is 302,150.
A fact that wij mentioned te the previous postbode spil well.
Do take note that this 302,150 comes directory from the authority webpagina blockchain.informatie .
Now we’ll budge on to some of the other gegevens points that wij need to measure Bitcoin’s consumption power.
The 2nd gegevens point is hashrate.
More specifically, bitcoin hashrate.
This number indicated, or rather measures, the real computation power of the Bitcoin network.
There are many ways to go about calculating this number.
But the most convenient one is the go forward with the number that is based on weekly averages .
This makes sure that the daily noise factor is smoothened out without causing many problems.
Right now, the latest statistics (true spil of March 1) waterput this weekly average to about Three.Trio million terahashes every 2nd.
That is, Three.Three million terahashes/s.
Elementary enough right?
Is Bitcoin fated to failure? Not for the reasons you might suspect.
Moving forward then.
Wij almost know everything there is to know if wij want to calculate Bitcoin’s consumption potential.
Now all that is left is to measure the efficiency of the miners that play a big role te the overall Bitcoin network.
Fortunately, wij now know the power consumption of Bitcoin miners spil well.
But to make the comparison fair, let’s take the power consumption of some of the most efficient Bitcoin miners.
That is, the most efficient Bitcoin miners on the market.
If wij look at the numbers, it seems like Antminer and BitFury are the top dogs with a gigantic lead.
Antminer S9 licks about .098 W/GH/s while BitFury is about two times more efficient than Antminer.
That’s because BitFury uses the more efficient gegevens center that is liquid cooled.
Of course, thesis numbers don’t represent the general mining community.
So te order to calculate a fairer lower strapped for the total amount of network energy consumed, wij should do the following.
This special number should be the global hashrate vanaf 2nd.
Again, we’ll go by the numbers that are available spil of March 1, 2018.
Do the calculations and you should come up with a number that closely resembles 332 megawatts of onveranderlijk energy consumption.
To be fair to the Bitcoin community, this number doesn’t seem like an awfully large number.
It is actually pretty reasonable considering other reports about Bitcoin’s energy consumption numbers.
Moreover, you also have to take into account the freshly announced plans from a particular Bitcoin entrepreneur.
Wij won’t go into the details of those plans here.
But just for information’s sake, the plans consist of setting up a 130 megawatt Bitcoin mining facility ter China of all places.
Since most people won’t be able to relate to a number like 332 megawatts of onveranderlijk energy consumption, let’s express that ter another way.
A way that will hopefully be more relatable to everyone reading this postbode.
More Lightly Understood Bitcoin Energy Consumption Number
Let’s assume that all Bitcoin miners were fine and ethical people or businesses.
Ter other words, let’s assume that all of them ran rekentuig hardware that wasgoed enormously efficient.
Not just efficient.
But enormously efficient.
Right now Bitcoin is simply not good for the environment.
If wij consider that case to be true, then the overall Bitcoin power consumption would come down.
Ter other words, not a lotsbestemming.
Regardless, if wij take the above-mentioned assumption then the total Bitcoin power consumption number would come at slightly lower than 332 megawatts.
To waterput it another way, Bitcoin would then consume power that could provide for the daily needs of around 268,990 average American citizen homes .
Spil you can most likely see, even when wij have considered Bitcoin miners to have a very efficient hardware, the consumption number is still thick.
But we’ll get to that part a bit straks.
Now keep that number 302,150 te mind.
This is the average weekly number of Bitcoin transactions.
What this basically means is that each Bitcoin transaction represents about 26 kWh of tens unit.
Most of this electrical play is spent during Bitcoin mining.
Spil wij have mentioned before spil well, the average electrical play required to power an American household for a period of 24 hours is slightly above 26 kWh.
Okay. The precies number is about 29.Two kWh.
More Bad News Regarding Bitcoin Energy Consumption
So if each American household requires an average of 29 kWh.
And each Bitcoin transaction munches up 26 kWh then that means that each Bitcoin transaction represents about 89 procent of an average American household energy needs.
That is bad right?
But evidently, the situation wasgoed even worse before.
Eventually, Bitcoin miners will come to terms with the energy problems.
Back ter the year 2015, Bitcoin consumed about 157 procent of an average American household’s electrical play requirements.
What’s the main take here?
The main takeaway here is that it is true that Bitcoin miners have improved their hardware.
Ter terms of efficiency and consumption of power, Bitcoin miners have become better miners.
Right now, Bitcoin miners can perform much more computation processes for each unit of power than before.
Moreover, compared to 2015, the number of Bitcoin transactions vanaf day have also enlargened.
So Bitcoin should be more sustainable now, right?
Or at least the energy situation with Bitcoin is getting better by the year, right?
Nothing to worry about right?
More like not necessarily.
Just because Bitcoin has become more efficient vanaf transaction doesn’t mean it is a sustainable payment system.
There are many reasons.
Very first Reason Why Bitcoin May Not Be A Sustainable Payment Method Just Yet
Spil far spil our analysis goes, the very first reason is simply our assumption.
Or rather our massive assumption.
Our assumption that all Bitcoin miners are ethical enough to be running the most efficient of rekentuig machines.
That simply cannot be true.
The postbode says Bitcoin transactions are not wasteful or unsustainable.
Let’s leave that aside for a minute or two.
The more interesting part is that Marc Bevand uses or rather assumes a different figure for global Bitcoin energy consumption.
He uses a figure of .15 J/GH.
Without going into too many details, this figure would add an instant fifty procent to the amount of electro-therapy consumed for every Bitcoin transaction.
Taking his figures, the Bitcoin energy consumption would go up to 134 procent of an average American household’s daily energy needs.
Nobody Knows The Precies Number On How Much Energy Bitcoin Munches Up.
Which brings us back to our original point.
Right now, no one indeed knows how much energy each Bitcoin transaction consumes.
But one thing should be clear by now.
That consumption number cannot be low regardless of the fact that no one knows the precies number.
That also holds true for the real efficiency number.
No one truly knows that either.
But the 0.15 J/GH quoted by Marc might not be useful because of it having gone out of date.
So we’ll go ahead and stick with the newer 0.098 J/GH for our analysis.
But here is another problem.
Some Bitcoin Experts Have A Different Idea About Bitcoin Energy Consumption
Mostly, they think that the overall Bitcoin energy consumption is not majorly affected by Bitcoin miner efficiency.
Ter other words, Bitcoin energy consumption is not affected by Bitcoin miner efficiency ter a significant way.
Here is what Ittay Eyal, who works spil an assistant director of the Initiative for Cryptocurrencies and Contracts (and is also a Cornell University pc scientist) told a reporter at Motherboard.
He said via email that Bitcoin’s energy usage wasgoed essentially a function of the currency’s exchange rate ter the market and of course, the block prize.
If that didn’t make any sense to you then suspend on for a 2nd.
What that indeed means is that it is inescapable that the price of Bitcoin will go up sometime ter the future.
To tegenstoot for that increase ter price, Bitcoin miners will not zekering from adding more laptop power to their systems.
Ter fact, they will add any amount that is necessary te order to restore the balance te favor of profitability.
That is the only way they can afford to keep their companies alive ter the Bitcoin mining industry.
Of course, they earn prizes for their services but that doesn’t mean they want more profits spil well.
That’s Not The Entire Equation Tho’
See, experts ter the Bitcoin community know this fact.
Bitcoin miners will proceed to add more computing power spil the prices go up.
Right off the bat, let’s ask the questions, what is it and what does it do?
The Bitcoin Tens unit Consumption Index is actually an online product from Alex Den Vries who works for Digiconomist .
More specifically, however, it is a real-time modeling instrument.
Now for the ‘what does it do” part.
The main function of Bitcoin Electric current Consumption Index is to gather figures related to Bitcoin on a daily onderstel.
To accomplish this along with other tasks it makes use of a plausible set of assumptions.
Thesis assumptions are then used to estimate the amount of electric current that could be used by the entire network.
So what is the entire network ter this situation?
Well, the entire network consists of many players.
But the major ones are the Bitcoin miners.
The Bitcoin Electro-therapy Consumption attempts to estimate the amount of electro-therapy that would be sufficient and viable (economically speaking) so that the entire Bitcoin network could consume and still be able to voorkant Bitcoin miners’ costs related to electric current consumption.
Of course, the actual process is a bit more ingewikkeld than that but you get the idea.
Perhaps you should also know that most of the gegevens that is collected for Digiconomist’s index is collected through automated means.
Additionally, the figures related to the output are also recalculated on a daily fundament.
Why Should Thesis Values Be Calculated On A Daily Onderstel
The logic behind the daily recalculation is spil sound spil it gets.
What wij mean by that is the, there should be a system te place that can account for price rise spil well spil price druppel.
Unnecessary to say, the estimated cost of power consumption on part of the Bitcoin network should also be recalculated spil the price fluctuates.
How Is Den Vries Calculation Different From The One Wij Have Mentioned Here?
It should be stated that all of our calculations are ordinary te nature.
And while our analysis is useful to find the lower strapped for the total cost, it isn’t a comprehensive future.
Te other words, economic incentives drive the market to a much larger extent.
Bitcoin miners will always attempt to treatment the break-even point.
The break-even point is the point where the Bitcoin price is exactly equal to the marginal cost it takes to produce a fresh Bitcoin.
Makes sense right?
To make more sense of the entire equation take a look at this 2015 Hayes’s paper .
The paper is titled ‘A cost of production proefje for Bitcoin’.
You don’t need to read the entire paper to figure out that Haye’s prototype does have a shortcoming.
Te other words, it is not always accurate ter terms of predicting the current energy consumption.
With that said, there is no doubt that the paper has its merits.
It can provide reasonably accurate averages of energy consumption ter the long run.
And that is te itself enough to justify his work.
We’ll talk more about how more accurate estimates can be made and what effect with Bitcoin have te the future of energy consumption on a global scale.