CryptoMonday.de has been studying data on BTC mining. The site concludes that miners’ incomes are dwindling owing to soaring electricity costs. The site reckons that over 75% of BTC miners’ income goes to meeting electricity costs.
Jonathan Merry, CryptoMonday.de’s CEO, has been discussing the data. He holds, “BTC mining is a very electricity-intensive process. A study has shown that a single BTC transaction consumes about 2165 kWh of electricity. That’s what your regular American household would use in 74 days! Factor in the roughly $0.14/kWh that an average household pays, and the magnitude of expenditure becomes evident.”
BTC’s proof-of-work consensus (PoW) conundrum
One of BTC’s core features, its proof-of-work (PoW) consensus mechanism, is also every miner’s headache. PoW requires them to solve complex equations for a share of newly mined coins. The equations require the use of specialized mining equipment with high computational power.
The equipment consumes tons of kilowatt-hours (kWhs), ballooning the miners’ electricity bills. BTC’s mining difficulty further compounds the situation.
BTC’s carbon footprint
PoW has also come under criticism for its environmental footprint. Critics hold that BTC is a wasteful and unsustainable crypto for the universe. Again, studies have shown its carbon emissions match those of entire nations.
One of them estimates that BTC emits nearly 114 megatonnes of CO2 annually, a value comparable to Czech Republic’s. Such figures raise concerns about the king crypto’s sustainability.
Addressing BTC energy and environmental concerns
Despite strong opposition from some quarters, BTC enthusiasts still believe in the crypto’s value. Bitcoinners hold that the industry is still in its infancy. As such, one would expect heavy investment in hardware, some of which may be inefficient. But with its maturing, there’s bound to be an evolution of the mining equipment to make them energy efficient.
Moreover, some miners have made the switch to fully renewable energy sources. Other quarters have suggested a complete shift to a less energy-intensive consensus mechanism. One of the popularly touted ones is Proof-of-Stake (PoS).
Read the full story here: Over 75% of Bitcoin miners’ income is going to electricity costs