As Bitcoin‘s price surges in the past year, the amount of energy used to mine the cryptocurrency, prompts many concerns about its impact on the environment.
Notwithstanding the currency‘s value seeing a recent decline, the energy that is used to harvest it has surged to a point where its yearly carbon footprint is equivalent to many countries including Argentina and Norway.
Mining Bitcoin requires a deep energy-intensive process that uses extensive electrical infrastructure and complicated mathematical algorithms to verify transactions. When solving any given calculation the miner is then rewarded with a Bitcoin.
“Rising bitcoin prices make mining more attractive, as the potential reward increases in value. As a result, new mining hardware will get added to the network and lead to increased electricity consumption overall,” a report says.
Even though it is not yet clear on how much energy Bitcoin actually uses, a study says that it consumes around 129.09 terawatt-hours (TWh) each year. The more bitcoin that is mined, the more energy is consumed.
“The more machines a miner operates, the more likely he is to find the solution to the puzzle. However, more machines also mean that more electricity is needed to run and cool the equipment, which in turn results in higher costs for the miner in question.”
The price of Bitcoin now hangs at nearly $44,150. There are around 18.6 million bitcoins in circulation according to Coinbase.
The main reason for Bitcoin’s boom is probably the recent investments from many major institutions although it has also given problems to its sustainability initiatives.
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