Passionate about privacy, encryption, bitcoin and the everlasting Hong Kong thriller. Dec 8, Bitcoin mining and energy consumption Ever since its creation, Bitcoin has come under fire for consuming electricity for its mining processes.
The Bitcoin network consumes massive amounts of energy
Most of these critics sadly do not share their reasoning, sources and calculations, making it hard to verify their claims. Admittedly, the topic is complicated and full of unknowns. By sharing some of our calculations and assumptions, we hope to make the debate more balanced and productive. As Bitcoin mining is unregulated and in many jurisdictions even illegal, there is no hard data on how much total electricity Bitcoin uses. Even in places where Bitcoin mining is regulated and legal, power companies do not necessarily know what the electricity is used for, and their statistics do not account for cryptocurrency mining.
Difficulty is a number calculated by the Bitcoin protocol and embedded into each Bitcoin block. This difficulty is a measure of how many hashes it takes for a miner to find a valid block in average. It is recalculated every blocks roughly two weeks in order to keep block intervals at roughly 10 minutes.
As of December 7, blockthe Bitcoin difficulty stands at 1,, The difficulty describes the target that the hash must undershoot. This is similar to throwing darts randomly at a large target. The difficulty describes the size of the bullseye. The smaller the bullseye, the more often you have to throw a dart to randomly hit the bullseye. You can see how this formula is derived here. For the current difficulty, this gives us an estimation of 1.
Bitmain is a manufacturer of Bitcoin mining equipment based in Beijing and Shenzhen. Their latest model, the S9, uses a 19nm chip. Earlier S9 models use the same electricity per hash. As this is the currently most energy efficient miner on the market, it allows us to calculate a lower boundary for how much electricity is consumed.
The total energy estimated to be used globally in is 13, Mtoe, or , GWh.
One estimate suggests the Bitcoin network consumes as much energy as Denmark.
Bitcoin consumes 1, MW in total, that is, 9, GWh over an entire year, or 0. This is just a lower boundary, but it is also a relatively good estimate.