The increased popularity of cryptocurrency and bitcoin mining is leading to massive increases in energy usage. Cryptocurrency energy usage will continue to be on the rise and based on recent studies, every bitcoin transaction that is currently processed is using 250kWh, which is enough energy to power residential homes for up to 9 days. This is the cause for concern for many and as more energy is being used, there are concerns regarding sustainability. With the growth rates as they are now, cryptocurrency energy usage could use the same amount of electricity as the whole world does today by the time 2020 rolls around. Add in the growing bitcoin online casino industry, and the energy usage will surely soar as gamblers find ways to mine bitcoin to gamble online.
Bitcoin Energy Consumption
Bitcoin mining and the use of the network consumes a high amount of energy on a regular basis and each transaction is using a large amount of electricity. The bitcoin industry is one that is highly competitive and electricity is one of the major costs. As the price of bitcoin rises, miners will be spending more on electricity until those costs are just about the same as the revenue generated from mining.
It is believed that the industry will spend an average of 60% of generated revenue on electricity and at this time, the network consumes roughly 32TWh every year. The actual cost of usage depends on the value of Bitcoin, so as values increase, so does the cost of electricity used to perform transactions. On average, the current energy use for a single Bitcoin transaction is 215 kWh and there are about 300,000 transactions being conducted daily. With more people engaging in Bitcoin mining and more bitcoin online casinos being created to offer another currency to use for real money gambling, there is no sign that mining practices will decrease, meaning the cryptocurrency energy usage will continue to soar.
Why Mining Uses So Much Energy
The consumption of energy by Bitcoin mining has become quite high since 2015 in comparison to other digital payment methods. This is due to the fact that the dollar price of bitcoin is directly related to the amount of electricity that is used during bitcoin mining. As the price rises, miners will use more computing power to find new bitcoins.
The reason bitcoin mining uses so much energy is due to how the network operates. Since bitcoin is a digital currency, there is no central bank involved. It is controlled by a large network of users who are using computing power to build block-chains of bitcoin transactions. Bitcoin mining involves performing a huge number of computer calculations to obtain bitcoin rewards and as bitcoin becomes more popular, cryptocurrency energy usage will be drastically on the rise.
Solutions to High Consumption Rates
Bitcoin mining may consume a lot of energy, but it is not creating an environmental disaster. However, there are concerns regarding the high energy consumption in Alberta and there are some things that can be done to lower the cryptocurrency energy usage. One is for the price of Bitcoin to decline, which will result in less energy being used to mine cryptocurrency. Another option would be to alter the mining process. The current algorithm is completely based on computing a number of hash functions. Cryptocurrencies aside from Bitcoin have been exploring some alternatives and one successful change has been with Bitcoin Gold, which is a new variant of Bitcoin that makes use of memory-hard mining algorithms that will not be as power hungry.