We know that bitcoins are a digital currency and that they are mined. But what does it take to really mine these coins? Well, energy, and lots of it.
Studies by Digiconomist, a platform that monitors cryptocurrencies, show more than 0.5% of the globe’s energy goes to mining Bitcoin and other digital coins. This figure is scary because it almost equals the amount of energy data centers use worldwide.
According to the UK-based Cambridge Centre for Alternative Finance (CCAF), today’s mining activities take approximately 118.79 TWh/year. This energy exceeds consumption in Argentina, Finland, New Zealand, and The Netherlands.
But consuming excessive power is only the start of a more significant issue–researchers consider the type of energy it consumes the main red flag. Globally, formerly closed-down coal and fossil fuel-driven centers are suddenly resuming operations to support these mining activities.
How Does Crypto Mining Work?
Cryptomining is a relatively simple concept–it follows the same route no matter the digital currency.
A miner uses a computer to crack codes or solve complicated mathematical problems during the process. If the computer solves the code, they have successfully mined a digital coin.
Mining platforms rely on sophisticated processors to solve these puzzles–these could be Application-Specific Integrated Circuits (ASICs), cloud mining units, or GPUs.
“Unlike your regular desktop, these sophisticated machines take up a significantly high amount of energy,” warns Chris Bronk, a junior professor at the University of Houston.
Competing Miners Contribute to a Larger Carbon Footprint
And that’s not all; the cut-throat competition among miners further fuels the problem. The more processing power you have, the more likely you will mine more of the digital coins present. CCAF estimates that mining just one bitcoin consumes up to 150,000 kWh of power. That figure represents a month-long supply of energy for 170 US households.
Currently, crypto mining firms run large banks of these high-power processors. According to the University of Hawaii, if the current mining rate persists, emissions from Bitcoin alone could increase global warming beyond 2°C.
“Its carbon footprint is huge and continues to increase,” says Camilio Mora, a professor at the University of Hawaii. “Mining digital currencies significantly speeds up climate change.”
Author Bio:- Content crafter Alex Wilmont has been active in the payments industry for over 15 years. He lives simply, gives generously, and loves his two dogs. His mission is to enhance and innovate the crypto payments industry for years to come.