Bitcoin’s power consumption is now making news. Mining Bitcoin has now become a seriously energy intensive affair. In fact, the mining process now consumes more electricity that all the electric cars in the world put together.
According to a report published by Morgan Stanley, the mining operations for Bitcoin will consume three times more electricity in 2018 than it did in the previous year. That means mining will use up as much energy as the entire country of Argentina uses in a year.
An analysis of the Bitcoin mining process revealed that it was going to use up 125 terawatt hours of power; that amount will not be used by electric vehicles across the world until 2025. Morgan Stanley’s report showed that the cryptocurrency’s mining operations used up 36 terawatt hours of electricity in 2017 – which is about the amount that Qatar uses in a year.
The reason for such high consumption of electricity during the mining process is because of the design of the Bitcoin system. When Bitcoin was created, its blockchain was limited to producing only 21 million Bitcoins. And another condition was that as more Bitcoins were mined, the mining process would become more and more difficult.
The Bitcoin mining process involves solving some really complicated mathematical puzzles called cryptographs. When these puzzles have been correctly solved, a Bitcoin is produced. However, to solve these puzzles, you need heavy duty computing power. This includes really huge computing systems that need coolers to keep them from overheating as they solve these cryptographs.
Morgan Stanley estimates that it takes about $3000 to $7000 to solve mine a Bitcoin; this is the cost of energy as well as the hardware required for the job. Despite the heavy costs incurred, Bitcoin mining is still very profitable.
Sign up for our newsletter
and don't miss out great opportunities to monotize on your bitcoin