The world of cryptocurrencies was launched in 2009 after an academic piece titled Bitcoin: A Peer-to-Peer Electronic Cash System by Satoshi Nakamoto introduced the system that would become the Bitcoin cryptocurrency. Years later, it has become one of the most popular forms of payment.
Bitcoin, Ethereum, Dogecoin and other popular cryptocurrencies hit record or near-record highs last year, raising concerns about the amount of energy needed to mine or “mine” the coins.
How much electricity does a supercomputer dedicated to cryptocurrency mining consume?
The warehouses of the mining platforms work many hours of the day and consume more energy per month than in some countries. As the energy bill for crypto mining increases, so does the amount of carbon and waste, adding to the climate crisis as well.
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What is cryptocurrency mining?
In the case of the exchange of bitcoin, the main cryptocurrency, computers around the world compete to complete a calculation that creates a 64-digit hexadecimal number, or hash, for that Bitcoin. This hash goes into a public ledger so anyone can confirm the transaction. The computer that solves the calculation first gets a reward of 6.2 bitcoins.
Other cryptocurrencies use similar mining technologies, which contributes to overall energy use.
What is a crypto mining platform?
Is a computer with multiple graphics cards, or GPUs, instead of the standard single card. The teams they usually use powerful GPUs from Nvidia and AMD to handle the calculations and require high voltage power supplies.
How much energy does mining consume?
According to Digiconomist’s Bitcoin Power Consumption Index, a transaction requires 1,544 kWh to complete, or the equivalent of about 53 days of power for the average American home.
To put it in monetary terms, the average cost per kWh in the US is 13 cents. That means a Bitcoin transaction would generate more than $200 in energy bills.