The use of electricity in mining Bitcoin (BTC) data centers will reach 7.7 gigawatts by the end 2018, an amount equal to the electricity consumption of Austria, for example, a country with almost 9 million inhabitants, according to a study published today in the specialized magazine Cell Press.
This means that cryptocurrency will consume 0.5% of global electricity production, a shocking figure, according to the study’s lead author, Alex de Vries, a financial economist from the Netherlands.
“It’s an extreme difference compared to the regular financial system, and this growing demand for electricity will definitely not help us reach our climate targets,” said de Vries, a cryptocurrency expert.
Mining Bitcoin (BTC) is consuming lots of power
The Bitcoin (BTC) depends on the computers that carry out the transactions in a continuous chain to avoid duplication of coin expenditure.
To perform this function, it is necessary to maintain a large number of computers connected almost uninterruptedly, which requires a high power consumption. Its economy-driven estimates put the current minimum current use of the bitcoin network at 2.55 gigawatts, which means it uses almost as much electricity as Ireland.
In fact, during a single transaction of a cryptocurrency uses as much electricity as an average household in the Netherlands in a month.
“If the price of bitcoin continues to rise in the way some experts have predicted, the grid could one day consume 5% of the world’s electricity,” the Dutch researcher said.
The technology that supports cryptocurrency works through nodes that form the decentralized network
In any traditional monetary system, governments print more money when they need it, but in the case of mining Bitcoin (BTC), it is not created but discovered.
Hundreds of thousands of computers from all over the world compete with each other in mining Bitcoin (BTC), that is, to generate this cryptocurrency.
Unlike other currencies, the BTC is a currency whose value does not depend on the interest rate fixed by a Central Bank or on its reserves in commercial banks. It is a currency that is subject to the laws of supply and demand through the net, increasing or decreasing its value on the basis of whether or not it is available on the market.
Jackson Bey was born and raised in Lethbridge Alberta but moved east when he was 22. Apart from running his own consulting firm. Jackson spends his time canoeing the many lakes of Ontario. As a financial journalist Jackson has published stories for CBC Business Online, as well as Buzz Feed and Motherboard. As a contributor to Billionaire 365, Jackson mostly covers markets and trade.