hbaker1@pipeline.com
Date: Mon, Nov 6, 2017 at 3:10 PM
[From Cryptography, via Dave Farber, long item PGN-truncated]
Christopher Malmo, Motherboard, 1 Nov 2017
One Bitcoin Transaction Now Uses as Much Energy as Your House in a Week
Bitcoin's surge in price has sent its electricity consumption soaring.
https://motherboard.vice.com/en_us/article/ywbbpm/bitcoin-mining-electricity-consumption-ethereum-energy-climate-change
Bitcoin's incredible price run to break over $7,000 this year has sent its overall electricity consumption soaring, as people worldwide bring more energy-hungry computers online to mine the digital currency.
An index from cryptocurrency analyst Alex de Vries, aka Digiconomist,
estimates that with prices the way they are now, it would be profitable for
Bitcoin miners to burn through over 24 terawatt-hours of electricity
annually as they compete to solve increasingly difficult cryptographic
puzzles to "mine" more Bitcoins. That's about as much as Nigeria, a country
of 186 million people, uses in a year.
This averages out to a shocking 215 kilowatt-hours (KWh) of juice used by
miners for each Bitcoin transaction (there are currently about 300,000
transactions per day). Since the average American household consumes 901
KWh per month, each Bitcoin transfer represents enough energy to run a
comfortable house, and everything in it, for nearly a week. On a larger
scale, De Vries' index shows that bitcoin miners worldwide could be using
enough electricity to at any given time to power about 2.26 million American
homes.
Expressing Bitcoin's energy use on a per-transaction basis is a useful
abstraction. Bitcoin uses x energy in total, and this energy
verifies/secures roughly 300k transactions per day. So this measure shows
the value we get for all that electricity, since the verified transaction
(and our confidence in it) is ultimately the end product.
Since 2015, Bitcoin's electricity consumption has been very high compared to
conventional digital payment methods. This is because the dollar price of
Bitcoin is directly proportional to the amount of electricity that can
profitably be used to mine it. As the price rises, miners add more
computing power to chase new Bitcoins and transaction fees. [...]
... at a minimum, worldwide Bitcoin mining could power the daily needs of
821,940 average American homes. Put another way, global Bitcoin mining
represents a minimum of 77KWh of energy consumed per Bitcoin transaction.
Even as an unrealistic lower boundary, this figure is high: As senior
economist Teunis Brosens from Dutch bank ING wrote, it's enough to power his
own home in the Netherlands for nearly two weeks. [...]