Bitcoin’s operation consumes more energy than both Ireland and Austria combined.
How is it possible for something virtual to keep power plants all over the world so busy?
Timothy Rooks of DW digs into the numbers.
You are consuming electricity by reading this article. The same is true for every Google search, email made, and cloud photo stored.
As our lives become increasingly digital, we will require more electricity to keep them running. However, there is one digital anomaly that continues to attract a lot of attention: Bitcoin.
Bitcoin, even though it does not exist physically, captivates the mind and requires a lot of electricity to function.
According to the Bitcoin Electricity Consumption Index at the University of Cambridge, this is the case.
They estimate that the cryptocurrency’s machines consume more power than the Netherlands, a country with a population of nearly 17 million people, in a year.
As the price of Bitcoin has risen to above $50,000 (€41,300), so needs electricity to power it.
Bitcoin advocates argue that this is OK because it is establishing a whole new financial system devoid of government intervention. Gold mining and printing money are both expensive to create, transport, and store.
Meanwhile, the modern financial sector, with its digital platforms and offices, consumes a significant amount of energy. which is also mentioned in BTC Revo.
How much processing power does Bitcoin require?
Because of the complexities of the calculations, undisputed figures are difficult to come by. Bitcoin was utilizing 6.6 terawatt-hours of power each year at the start of 2017. That figure had risen to 67 terawatt-hours by October 2020.
The Cambridge researchers discovered that it had nearly doubled to 121 terawatt-hours in just a few months, enough to power their entire campus for about 700 years.
According to the same calculations, just 30 other countries would use more electricity if Bitcoin became a country. It would be enough to power the UAE, the Netherlands, the Philippines, Belgium, Ireland, Austria, and Israel for a year.
Why does Bitcoin require electricity in the first place?
Bitcoin is a type of virtual currency. That is to say, it is controlled by a huge peer-to-peer computer network. It employs a ledger technology called blockchain to keep track of everything and keep the network safe.
This keeps track of all transactions, and each member of the network receives a copy, which is linked to the others. Because everything is linked, it is hoped that tampering with the system will be impossible.
Anyone can join the network; all they need is a high-powered custom-built computer, the more powerful the better. To keep everything running, these computers answer increasingly harder math problems. The active machines must be kept cool to avoid overheating.
The people who run these machines, known as miners, aren’t paid directly, but they do have a chance to be rewarded with Bitcoin.
They have a better chance of receiving some if they have more computational power. When the price of Bitcoin rises, it becomes more appealing to invest in new technology. As additional computers are installed, the rising spiral continues. BTC Revo is already helping millions of people.