Image for post
Image for post

Bitcoin is An Energy Hog

And its value seems tied to that fact

  • Consumed up 690,990 kWh for each block.
  • Expended 57,582 kWh for each Bitcoin.
Image for post
Image for post
Yellow: Bitcoin Exchange Rate; Blue: Cost to produce one Bitcoin with average cost of US electricity; Red: Cost to produce one Bitcoin with average cost of Chinese electricity; Date range: January 1, 2014 — December 25, 2017
Image for post
Image for post
Yellow: Bitcoin Exchange Rate; Blue: Cost to produce one Bitcoin with average cost of US electricity; Green: Cost to produce one Bitcoin with average cost of NYC electricity; Date range: June 2017— December 2017

Ch — Ch — Ch — Ch — Changes!

The next reward halving in 2020 [7] could cause bitcoin to completely fall over if the value of bitcoin doesn’t grow in proportion to the cost of mining. If it all works out, there are decades left until all Bitcoin are mined and the network will have to run off transaction fees. Energy consumption is what I see as the biggest concern.

Increasing Efficiency

One of the easiest, yet most hotly debated changes is increasing the block size. Increasing the block size has two effects: 1) It will allow more transactions to be processed per block. It will increase the number of transactions verified every 10 minutes and appended to the blockchain. 2) It allows more data to be stored in each transaction. Storing more data is contrary to the goal of processing more transactions, as data associated with each transaction limits how many transactions can be stored in a block.

Other Schemes

Other blockchain tokens use other schemes besides proof of work. One token, called Chia, is looking at using proof of pace. At one point, there was mention of verifiable delay functions, but their website doesn’t mention it any longer. Some use proof of stake — which basically assumes someone with a large stake will not act against it’s own interest. In Hashgraph, each node talks about what it knows about and what it has sent to other nodes until all nodes can prove every node knows everything they know — like a proof of consensus.

Footnotes

  1. https://digiconomist.net/bitcoin-energy-consumption
  2. https://www.electricitylocal.com/
  3. https://www.eia.gov/electricity/monthly/epm_table_grapher.php?t=epmt_5_3
  4. https://www.statista.com/statistics/263492/electricity-prices-in-selected-countries/
  5. https://blockchain.info/charts
  6. To compute cost of creating one Bitcoin, I established a correlation between the number of TH/day and kWh/day as value conv in TH/kWh. To compute the value use: 60*60*24*TH_s*conv*energy_cost/1600
  7. http://www.bitcoinblockhalf.com/
  8. https://github.com/bitcoin/bitcoin

Jill Burrows

Dissecting the world layer by layer.

Jillian Ada Burrows

Written by

I am very odd. One day, I’ll one-up myself and get even. If you like what I write, please share it. https://patreon.com/adaburrows

Jill Burrows

Dissecting the world layer by layer. From creative writing to more in-depth research, we seek to educate and fill the furtive gap of history’s connections to the present.

Jillian Ada Burrows

Written by

I am very odd. One day, I’ll one-up myself and get even. If you like what I write, please share it. https://patreon.com/adaburrows

Jill Burrows

Dissecting the world layer by layer. From creative writing to more in-depth research, we seek to educate and fill the furtive gap of history’s connections to the present.

Welcome to a place where words matter. On Medium, smart voices and original ideas take center stage - with no ads in sight. Watch

Follow all the topics you care about, and we’ll deliver the best stories for you to your homepage and inbox. Explore

Get unlimited access to the best stories on Medium — and support writers while you’re at it. Just $5/month. Upgrade

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store