An Indian house can live a year with the energy it takes to mine 1 bitcoin - Business Insider India

An Indian house can live a year with the energy it takes to mine 1 bitcoin – Business Insider India

  • Bitcoin mining It is known to be unfriendly to the environment and ineffective.
  • Now, a new study claims that miners spend $3 out of $4 of their bitcoin income on paying for electricity.
  • Another study estimates that mining one bitcoin consumes the same amount of electricity as an Indian household in 380 days.

Bitcoin Mining has long been criticized for being inefficient and energy consuming. Now, a new report says that electricity fees are actually the biggest contributor to bitcoin mining costs.

According to a report by
encryptionThe electricity costs of Bitcoin mining can be too high for some. The report adds that $3 of every $4 bitcoin miners earn is directed toward paying for electricity.

Mining one bitcoin can consume up to 2,165 kilowatt-hours of electricity. according to
studyOn average, an Indian household consumes 5.7 kWh per day – it would take 380 days for an Indian household to consume the same amount of electricity needed to mine one Bitcoin.

Cryptocurrencies – despite all the money people have made from them – have always been a concern for being unfriendly to the environment. Although solutions are being worked on to reduce the environmental impact of mining these cryptocurrencies, there is still much room for progress in this regard.

Bitcoin Proof of Work (PoW) Problem

Bitcoin uses a “Proof of Work” (PoW) mechanism to regulate the creation of new blocks and the general state of cryptocurrencies. On the other hand, Proof of Stake (PoS) uses a simple mechanism to lock coins into a smart contract and the owners make their stakes via the lottery system.

For a long time now, PoW has been criticized for consuming more power than PoS. PoS evangelists also claim that it’s more secure than Proof of Work – basically, there’s a good reason not to use PoS.

According to one estimate, bitcoin mining emits 114 megatons of carbon dioxide per year. To put this in context, this equates to annual carbon dioxide emissions in the Czech Republic, which has a population of about 11 million.

For comparison, global carbon dioxide emissions in bitcoin mining are more than 4% of India’s total carbon dioxide emissions – with a population of approximately 1.38 billion people.

Other estimates suggest that bitcoin mining uses 127 TWh of electricity – equivalent to Norway’s annual consumption.

Why is Bitcoin mining becoming increasingly expensive?

Bitcoin derives its value from scarcity. To ensure the stability or growth of its value, the rate of bitcoin mining is managed in such a way that it does not result in an oversupply.

Bitcoin mining is based on solving complex mathematical equations. The more computational power available, the more difficult it is to mine Bitcoin. Likewise, the less computing power there is, the easier it is to mine.

This logic behind the value of Bitcoin and therefore mining it is one of the main reasons why there is more power to mine the same Bitcoin today compared to a year or a decade ago.

See also:

Bitcoin mining generates 30.7 kilotons of e-waste annually – enough to cover e-waste in Luxembourg five times

Mukesh Ambani and Gautam Adani take 1 dollar out of every 5 dollars in foreign loans

Vodafone Idea Will Have a Strong War Fund ‘Transform’ If It Makes an Amazon Deal

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