Bitcoin's Growing Energy Problems

Discussion in '[H]ard|OCP Front Page News' started by rgMekanic, May 16, 2018.

  1. rgMekanic

    rgMekanic [H]ard|News Staff Member

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    This isn't the first time that we have reported on the energy consumption of cryptocurrency mining, however this is the first time that a peer reviewed paper is looking into it. Financial economist Alex de Vries published a paper in Joule today that makes a solid prediction on the amount of power that Bitcoin is consuming. The paper states that currently, Bitcoin is using at least 2.55 gigawatts of electricity, for prospective, Ireland uses 3.1 GW annually, and looking at and estimating the number of chips that Bitmain is able to produce, that number could go up to 7.67 gigawatts by years end.

    Important to remember that these figures are for Bitcoin only, and not Cryptocurrencies as a whole.. I shudder to think of the amount of power being consumed combined. Crazy stuff, I honestly can't see how it's sustainable.

    This paper has outlined various methods that are currently used in determining the current and future electricity consumption of the Bitcoin network. These methods tell us that the Bitcoin network consumes at least 2.55 GW of electricity currently, and that it could reach a consumption of 7.67 GW in the future, making it comparable with countries such as Ireland (3.1 GW) and Austria (8.2 GW).15 Additionally, economic models tell us that Bitcoin's electricity consumption will gravitate toward the latter figure. A look at Bitcoin miner production estimates suggests that this figure could already be reached in 2018. With the Bitcoin network processing just 200,000 transactions per day, this means that the average electricity consumed per transaction equals at least 300 kWh, and could exceed 900 kWh per transaction by the end of 2018. The Bitcoin development community is experimenting with solutions such as the Lightning Network to improve the throughput of the network, which may alleviate the situation. For now, however, Bitcoin has a big problem, and it is growing fast.
     
  2. Kyle_Bennett

    Kyle_Bennett El Chingón Staff Member

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    Cryptocurrency is the reason all those polar bears are dead now.
     
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  3. sfsuphysics

    sfsuphysics I don't get it

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    In before the "if they can pay for it then who should care" people
     
  4. WhoMe

    WhoMe Gawd

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    Is that like the "if it moves, I should be allowed to shoot it," people?
     
  5. Twisted Kidney

    Twisted Kidney 2[H]4U

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  6. HaloSVT

    HaloSVT n00bie

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    Great we banished old style blubs for LEDS and then BOOM Cryto mining from left field :/
     
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  7. SecretStash

    SecretStash Limp Gawd

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    Conservative gamers and liberal environmentalists unite?
     
  8. griff30

    griff30 I Lower the Boom!

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    Good.
    Maybe the Global Warming types will go after the herp derp "Lambo" chasers.
     
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  9. Nenu

    Nenu Pick your own.....you deserve it.

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    Blubs being banished has gotta have caused more STDs too.

    Back on target, crypto mining is a right fucking waste of energy.
    Crypto currency, ok.
    No need for this mining crap. Especially as the process to create what is used as real money is a load of bollocks.
    Who the hell allowed this to even start being classed as currency when it is created this way?
     
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  10. viper1152012

    viper1152012 Gawd

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  11. viper1152012

    viper1152012 Gawd

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  12. Probleminfected

    Probleminfected [H]ard|Gawd

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  13. craigdt

    craigdt Gawd

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    if they can pay for it then who should care
     
  14. sleepybp

    sleepybp Limp Gawd

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    But what about the guys who mortgaged their house to pay for their gpu farms?
    Or the guys who are anti mega bank and can claim victory after we ruin the planet but replace traditional banks....
     
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  15. EODetroit

    EODetroit [H]ard|Gawd

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    The problem with cryptocoin mining is that nothing of inherent value is being done. At least when you do a job, a toilet got cleaned, or a burger got made, or a rocket got launched, or people were entertained or informed. Crypto-mining is making money by doing essentially nothing but enabling more crypto; its value depends on circular reasoning.

    Maybe it can break out of this rut its in, but to do that they need to get to fiat money status: acceptable for payment most places, and its value can't be in a perpetual deflation cycle that rewards saving over spending.
     
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  16. JerRatt

    JerRatt Limp Gawd

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    The ENTIRE crypto market power usage is a FRACTION of the energy use that both cash and the credit systems use. You don't see tech sites blasting that, though, do you?
     
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  17. rgMekanic

    rgMekanic [H]ard|News Staff Member

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    Link?
     
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  18. JerRatt

    JerRatt Limp Gawd

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    Do research on the entire process of printing money, and the network infrastructure of the financial system that runs world currencies today. You're not going to find a single article. Things like this take study, not being handed out a single article.
     
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  19. [21CW]killerofall

    [21CW]killerofall Aliens...

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    So you don't know what you are talking about. Got it ;).
     
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  20. IcePickFreak

    IcePickFreak Gawd

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    If only they would accept blockchain as their lord and savior, they could be saved!
     
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  21. pendragon1

    pendragon1 [H]ardForum Junkie

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  22. pendragon1

    pendragon1 [H]ardForum Junkie

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    so youre doing research to prove that the old money system uses more power than the crypto way?
     
  23. _l_

    _l_ Gawd

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    lol, made me laugh.

    Regarding power usage ... they'll just build more nuke reactor plants
     
  24. risc

    risc [H]Lite

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    I agree that all things consume energy, however there is a cost/benefit to utility.

    Cash is printed, transported, distributed, and exchanged. People drive cars to ATM's and banks, then it's exchanged many times between people and eventually destroyed/replaced. Similar with credit/debit cards.

    It's being used and is useful.


    IMO, Crypto is an additional layer to the existing system and are basically distributed stock markets, currently there's no use, just waste.
     
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  25. Krenum

    Krenum [H]ardForum Junkie

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    Not attacking you but Crypocurrency isn't built upon trust like traditional currency. Not only can you not trust it from its volatility, but their are no first world governments or foundations backing it. When I can pay my electric bill or car insurance with cryptocurrency then maybe Ill see otherwise.
     
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  26. BSmith

    BSmith Gawd

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    There is no reasoning with the cryptocrazed.

    If you cryptocrazies think power is not an issue, then you will not mind paying for electricity based on the percentage you use, compared to everyone else in your grid.

    Example: Say 10 homes are in your grid. You use 55% of all the electricity in your grid. The 9 other homes use 5% each of the total power consumed in your grid. The power company determines your grid needs to pay $0.20/kWh. So your rate per kWh is 55% of that $0.20, while your 9 neighbors pay 5% each, of that $0.20kWh.

    This would be in a residential environment. It gets a bit more complicated in a commercial environment.

    Just a thought.
     
  27. Retronym

    Retronym Something big is coming.

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    To the anti-economics people:

    What is your answer?

    If you outlaw use-cases by energy consumers, that could include your pornhub and torrents as well.
     
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  28. risc

    risc [H]Lite

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    I don't see anyone here asking for a ban, just discussing the subject because it's interesting.

    Well there is the one guy proposing tiered electric charges, which I already live under, so that's the answer to your economics question.
     
  29. [21CW]killerofall

    [21CW]killerofall Aliens...

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    Apparently your sarcasm detector is broken...

    Also you can't just leave one statement with NOTHING to back it up and expect people to believe it. You could have posted one reference but didn't (doesn't even have to be a link, could be printed medium citation, or hell, even a short statement explaining your logical thinking). Also we don't know who you are. You could be Joe Blow who sells crack on the street or some genius scientist with several doctorates and we would never know the difference. Also note that I never said that you were wrong (I am actually fairly certain that you are right and it doesn't even take any research to figure that out. I am sure that all of the POS computers in the US take a good chunk of power to run), you just assumed that along with many other assumptions.
     
  30. Hagrid

    Hagrid Kyle's Boo

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    People are paying for their power, not sure of the problem here?
    They could make it tiered with a steep curve, but if everybody does not do it, they will go someplace else.
    Make more power!
     
  31. funkydmunky

    funkydmunky [H]ard|Gawd

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    The article states BitCoin, not Crypto as a whole. Who is mining BitCoin in the highest volume, and how is this expected to go up nearly 4X by years end? That is a shit-load of BitCoin ASIC's.
    Or is this the usual BS click-bait article where they call every coin BitCoin?
     
  32. Sycraft

    Sycraft [H]ardness Supreme

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    No, the opposite rather. See companies like Visa want to use as little energy as possible. Money spent on energy is money that doesn't go in their pockets. A Visa transaction is somewhere around 1,000,000-10,000,000x more efficient (in terms of energy/transaction) than Bitcoin. Oh and I can back that up with sources too.

    Sorry that your magic Internet money isn't quite as magic as you might want, but that shit is seriously inefficient when it comes to power use and transaction speed.
     
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  33. sfsuphysics

    sfsuphysics I don't get it

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    Well that actually took longer than I expected
     
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  34. aaronspink

    aaronspink [H]ard|Gawd

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    Visa can process more transactions in an hour than bitcoin can do in a year as a reference(and does that while complying with regulatory frameworks the world over, the sheer humor that many that support bitcoin complain about regulatory waste). To process the yearly transactions that Visa does, bitcoin would need on the order of 30 TERAWATT hours of power (to put that in perspective, that is ~1/4 of total worldwide energy consumption). These idiots that think bitcoin is at all useful are fooling themselves so hard.
     
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  35. travisty

    travisty Gawd

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    Umm... Never heard of the scientific method? If this is being peer reviewed the study is valid - basically the complete opposite of your make-believe "I say therefore it's true"

    Even if you're correct and the entire global energy usage for monetary transactions dwarf the energy used for cripto-currency so too does the number of transactions.

    US + Europe credit card transactions per year are roughly 144 billion (https://www.philadelphiafed.org/consumer-finance-institute/statistics) and 54 billion (https://www.ecb.europa.eu/press/pdf/pis/pis2016.pdf?be9989f6bd72483ebe27d8dfae1f0362) respectively.

    In contrast bitcoins have roughly 200,000 transactions a day (https://blockchain.info/charts)

    Let's do some math:
    230k * 365 = 73 million transactions a year (bumping the transactions per day up slightly to favor a more conservative estimate)
    So it takes roughly 2.55 gigawatts to perform 73 million transactions. That works out to be 3.5 watts per bitcoin transaction

    200 billion transactions a year for US & EUR. This is a very low estimate as it excludes the rest of the world, bank-to-bank transactions (which i'd guess dwarfs this credit card transaction numbers), and businesses paying via wire.
    If it took as much electricity to perform transactions as bitcoin: 200 Billion * 3.5 watts = 700 Gigawatts or the equivalent of the combined power consumption of Germany + Mexico - again just for credit card transactions in US & EUR
     
  36. d3athf1sh

    d3athf1sh Limp Gawd

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    what about all the servers that have to stay online to keep the financial system and banks online to make standard money valid and all the plants that die and fuel for farm equipment to process them and chemicals used to make paper money and fuel to transport the raw materials and what about the mining of metals to make coins then the fuel used to move all that money around. that's alot of not only electricity but oil burned to keep standard money system going.

    just sayin
     
  37. knowom

    knowom Limp Gawd

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    Cryptocurrency at it's core is basically a money laundering scam. You don't understand I'm taking about fractions of a penny here and over time they add up to a lot.
     
    Last edited: May 17, 2018
  38. aaronspink

    aaronspink [H]ard|Gawd

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    I'm guessing it isn't quite literally 1/4 of worldwide power that would be required by bitcoin to replace it. Those financial servers take a small fraction of the bitcoin power while providing orders of magnitude more transactions. In addition, if we are going to do total energy consumption for VISA et al, we would have to do it for bitcoin as well, which would significantly increase its power requirements as well.

    The reality is that the computer machines running VISA and bank transactions are incredibly efficient at what they do. The core transaction machines for VISA are pretty few and probably take up maybe ~350 MWh per year while providing ~20,000 times the TPS.

    Does the total global financial system take up more power than bitcoin? Probably, but it is providing probably a billion times more transactions per year or more and is providing those transactions literally everywhere in the world. But the bitcoin number we have is just the transaction machines not the whole of the financial network around those transactions. The reality is that current cryptocoin systems are so incredibly inefficient that they simply aren't viable.

    Also I apparently made a mistake earlier in my previous post, I was using the 3.1 GW for bitcoin as GWh, so I was off by ~9k, which puts bitcoin at 263000 TWh just to process as many transactions of VISA can in a year. This is roughly 1600 TIMES WORLDWIDE YEARLY ENERGY PRODUCTION!!!!!!!
     
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  39. Nebell

    Nebell [H]ard|Gawd

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    Guys you seen any difference 2 years ago and now?
    Looks sustainable to me ;)
     
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  40. DigitalGriffin

    DigitalGriffin [H]ardness Supreme

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    Last I checked it doesn't take 300KWh to hand someone cash or a check or even process a credit card transaction.
     
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