Keeping a massive cryptocurrency like Bitcoin secure is apparently a resource-intensive task. Statistics released this past week revealed the incredible amount of electricity that is consumed by Bitcoin mining—almost as newsworthy as the value of BTC reaching record highs, nearly $10,000 USD on November 27.
The official figure given for Bitcoin’s power consumption is 30.14 TWh per year. That is more than the annual electricity consumption of the entire country of Ireland. As a matter of fact, its energy use exceeds that of no less than 19 European nations.
Just to put that in perspective, the power draw from Bitcoin mining is five times the amount of energy product by Europe’s largest windfarm. Based on the average volume of transactions using BTC, it means that each transaction consumes enough power to boil tens of thousands of liters of water in order to be verified.
What is Bitcoin mining, and why does it use so much electricity?
The mining system is one of the core features of Bitcoin, which pioneered the cryptocurrency movement in many ways. Mining is what maintains the security and integrity of the currency and every transaction it moves through, all in a decentralized fashion (which is part of its appeal to many users). Volunteers, known as miners, verify each BTC transaction with specialized computers that must solve complex problems in order for the transaction to be confirmed as valid and be allowed to process.
The thing is, solving those verification problems is extremely power-intensive, but it is not without its reward. Miners are compensated for their efforts (and resources) in the form of Bitcoin, naturally. It might not have seemed like a good return back when the value of 1 BTC was around $200 USD, but that has certainly changed now that the currency seems to have entered a new bubble phase, breaking $9000 USD for the first time this past week.
It’s reasonable to expect, then, that the number of people mining the Bitcoin network will increase dramatically, motivated by the sudden upturn in the value of the reward. This, in turn, means even more electricity being consumed as more and more computers work through the resource-intensive process of verifying transactions. What is still unclear is whether the mining boom will become a mining bust if this latest BTC bubble ever bursts.