The Debate Over Crypto Electricity Usage is Heating Up, But Clear Answers…
With market value on the rise, the Bitcoin hash rate, as well as that of other proof-of-work (PoW) cryptocurrencies, is escalating. This increase is driving up electricity usage, which is once again sparking a debate over which type of blockchain architecture should be used for mass adoption. Unfortunately, the electricity issue is complex, with conflicting data over how much is used as well as the impact of its use on the global energy supply. There is no doubt that clarity is sorely needed as the crypto space advances.
Even if specific figures are elusive, the fact remains that PoW cryptocurrencies consume a tremendous amount of electricity. Bitcoin presently uses between 35-65 terawatt hours per year, which is more than many countries. At least as much is consumed collectively in the mining of other platforms such as Ethereum, Bitcoin Cash, and Dash. Additionally, an enormous amount of electricity is used to produce the mining hardware for these platforms, most of which is useless for other computing processes.
Should Bitcoin or a similar platform attain mass use the electricity consumption will certainly increase many times over, which at first glance would appear unsustainable. Nevertheless, a number of mitigating factors support the assertion that PoW cryptocurrencies will have a relatively small impact on global power usage. In fact, some PoW advocates claim that these types of crypto platforms add to the global economy by taking advantage of certain unique characteristics of electricity production.
A key issue is the fact that most power plants produce significant waste electricity, generally at night. Generating this excess power is unavoidable, yet it can be purchased for crypto mining. Taking advantage of this waste electricity is also supported by proponents of electric vehicles as well as home battery advocates.
Additionally, renewable energy is a very good fit for PoW cryptocurrencies. In fact, according to a recent study almost seventy-five percent of mining already utilizes it. Smart-grid technology, which ironically will be made vastly more efficient by blockchain systems, can theoretically give PoW the ability to take place entirely with sustainable electricity that would otherwise be lost.
Even if the electricity usage of PoW can be offset, critics note that such a process is no longer necessary. More advanced blockchain platforms can create consensus with very little power consumption. Whereas the mechanisms they use, such as proof-of-stake, have their own shortcomings, PoW has proven to be far less secure than originally thought. It is worth noting that a number of the platforms that rely on it have suffered 51% attacks, the most recent being Bitcoin Cash.
Although other issues such as scalability and regulation may be garnering the most media attention, there is no question that electricity usage by crypto platforms is a serious issue that must be addressed. If platforms such as Bitcoin are to thrive, the mining process must become greener and less resource intensive. More research is, of course, necessary to determine if this feat is possible.
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