41 votes

Bitcoin's energy consumption is growing at 20% per month and threatens to erase decades of progress on renewable energy

38 comments

  1. [13]
    shiruken
    Link
    A new paper published in Joule estimates that the Bitcoin network currently consumes 2.55 gigawatts of electricity. This is equivalent to the electrical consumption of the country of Ireland. By...

    A new paper published in Joule estimates that the Bitcoin network currently consumes 2.55 gigawatts of electricity. This is equivalent to the electrical consumption of the country of Ireland. By the end of 2018, consumption will increase to around 7.7 gigawatts (0.5% of the world's total consumption). By late 2019, the energy demand of Bitcoin will surpass the entire planet's solar power production.

    25 votes
    1. [12]
      Whom
      Link Parent
      Holy shit. I knew it was a waste but I really hadn't considered just how much of an energy impact it has. Holy living fuck. What is the pro-bitcoin response to this? Just that it's worth the...

      Holy shit.

      I knew it was a waste but I really hadn't considered just how much of an energy impact it has. Holy living fuck.

      What is the pro-bitcoin response to this? Just that it's worth the trade-off for the freedom it provides, or that this is a growing pain until mining isn't profitable for anyone anymore?

      19 votes
      1. [7]
        Natanael
        (edited )
        Link Parent
        Bitcoin will never spend more energy on mining than the miners earn from mining rewards due to how difficulty adjustments and the incentives works. If the value falls, mining decreases. If...

        Bitcoin will never spend more energy on mining than the miners earn from mining rewards due to how difficulty adjustments and the incentives works. If the value falls, mining decreases. If electricity becomes more expensive, then mining decreases. In both cases difficulty adjusts until it hits equilibrium.

        Edit: my comment answered the question, what's with the noise label?

        5 votes
        1. tumbzilla
          Link Parent
          I think the challenge is that an increase in electricity costs will impact more that just Bitcoin. If Bitcoin drives up the cost of energy, then a number of industries will be adversely affected.

          I think the challenge is that an increase in electricity costs will impact more that just Bitcoin. If Bitcoin drives up the cost of energy, then a number of industries will be adversely affected.

          4 votes
        2. [2]
          Whom
          (edited )
          Link Parent
          I think I was one of the ones who applied the noise tag, I can't check now though. Maybe it was overreaching a little, but it doesn't answer the question, unless the only response pro-Bitcoin...

          I think I was one of the ones who applied the noise tag, I can't check now though. Maybe it was overreaching a little, but it doesn't answer the question, unless the only response pro-Bitcoin people have is that the only way the problem goes away is by Bitcoin crashing or if it pushes electricity prices up and already does its damage.

          It's noise because it also doesn't really say anything. All you've said is "people will only do it to the point where mining is still rewarding" which I think everyone in the thread came in with and was speaking with that knowledge in mind. It'd be like popping into a thread about Trump policies and saying "Donald Trump is the president of the United States."

          I didn't want to be a jerk about it but since I just noticed you asked...

          3 votes
          1. Natanael
            Link Parent
            I know it wasn't a complete answer in that regard, but it does show how the energy usage will not grow infinitely. The market for the currency must be able to bear the cost. Also, more efficient...

            I know it wasn't a complete answer in that regard, but it does show how the energy usage will not grow infinitely. The market for the currency must be able to bear the cost.

            Also, more efficient miners are more profitable, and this includes those using the generated heat for meaningful purposes, such as heating buildings. In this case, they're essentially electric space heaters with a second purpose, and reducing the net heating costs.

            1 vote
        3. [3]
          ConfusingDalek
          Link Parent
          Honestly, not even sure how people are applying the noise tag to you. I don't see a tag button anywhere.

          Honestly, not even sure how people are applying the noise tag to you. I don't see a tag button anywhere.

          2 votes
          1. [2]
            cfabbro
            Link Parent
            Comment tags were a thing until a few days ago... they have been disabled (until they can be reworked) because of users abusing them to mark comments they disagree with, like you're seeing on...

            Comment tags were a thing until a few days ago... they have been disabled (until they can be reworked) because of users abusing them to mark comments they disagree with, like you're seeing on @natanael's comment, when that was not their intent.

            7 votes
            1. ConfusingDalek
              Link Parent
              Ah, didn't realize it was from days ago.

              Ah, didn't realize it was from days ago.

              3 votes
      2. teaearlgraycold
        Link Parent
        The most pro-cryptocurrency response is that there are alternative solutions. Currently Bitcoin uses proof of work, but proof of stake could be used and consume much less power.

        The most pro-cryptocurrency response is that there are alternative solutions. Currently Bitcoin uses proof of work, but proof of stake could be used and consume much less power.

        1 vote
      3. [4]
        Comment deleted by author
        Link Parent
        1. [2]
          Whom
          Link Parent
          This seems rather off-topic, as it doesn't even mention anything about traditional currency.

          This seems rather off-topic, as it doesn't even mention anything about traditional currency.

          1 vote
          1. [2]
            Comment deleted by author
            Link Parent
            1. Whom
              Link Parent
              Does Bitcoin somehow kill off national defense? According to your article, that is by far the worst offender. If it mentioned inefficiencies in the minting process or something then I could see...

              Does Bitcoin somehow kill off national defense? According to your article, that is by far the worst offender. If it mentioned inefficiencies in the minting process or something then I could see relevance, but as it is all you've done is point out that there is something which is not Bitcoin which does more harm than Bitcoin. Unless you're trying to argue from the standpoint of a Bitcoin-dominated future that topples the US government because they don't collect any taxes, in which case...still not really relevant, because that would need to be argued itself.

              Also the article is just...worthless. I'm all for pointing out environmental missteps and abuse wherever they happen, but this is little more than a blog post which says "the government pollutes a lot". Like okay, thanks...and? Gonna bring up anything about the scale of what they're doing and how that compares to private companies on similar scales (not that there's anything on the level of national defense)? No, okay...gonna discuss how it could actually be more efficient? No, okay...I don't think it's interested in saying anything, let alone something that would be relevant to this conversation.

              3 votes
  2. [4]
    cfabbro
    (edited )
    Link
    What an absolutely absurd situation we have found ourselves in as a species with regards to crypto currency. It’s like a confluence of all of our worst qualities and lack of understanding...

    What an absolutely absurd situation we have found ourselves in as a species with regards to crypto currency. It’s like a confluence of all of our worst qualities and lack of understanding combined; Greed, gullibility, suseptability and desire to commit fraud (pyramid and get rich quick schemes), shortsightedness, disregard for environmental impact, consumer culture, distrust of government, bandwagoning, ideological evangelism, artificial scarcity, obsession in all forms, etc, etc, etc...

    It’s like Beanie babies but so, so much worse since even banks, billionaires and governments are investing in them now. This is going to be a fucking disaster of such epic proportions when the house of cards inevitably collapses.

    22 votes
    1. [3]
      shiruken
      Link Parent
      At least we'll finally be able to buy new graphics cards when the entire cryptocurrency market implodes.

      At least we'll finally be able to buy new graphics cards when the entire cryptocurrency market implodes.

      16 votes
      1. TheSaltShaker
        Link Parent
        The market has already started to slow down, at least since the bubble. GPU prices are getting back to normal, and the 11xx series was teased/announced, so sales must have slowed down enough for...

        The market has already started to slow down, at least since the bubble. GPU prices are getting back to normal, and the 11xx series was teased/announced, so sales must have slowed down enough for NVIDIA to release a new card. Hopefully another bubble won’t happen when new GPUs come out.

        2 votes
  3. [8]
    CALICO
    Link
    Somebody please correct me if I'm wrong, but is Bitcoin not obsolete? I was under the impression that there were critical scaling problems in its architecture, and there are now more efficient...

    Somebody please correct me if I'm wrong, but is Bitcoin not obsolete? I was under the impression that there were critical scaling problems in its architecture, and there are now more efficient next-gen blockchains that correct that problem.
    I suppose as an asset it may still hold value, but not as much as a technology.

    9 votes
    1. [7]
      Amarok
      Link Parent
      Bitcoin has been subverted by moneyed interests and large financial institutions who want to gate access to it by keeping transaction fees high and implementing their own sidechains. That way...

      Bitcoin has been subverted by moneyed interests and large financial institutions who want to gate access to it by keeping transaction fees high and implementing their own sidechains. That way almost everyone will have to use the sidechains to use bitcoin (unless you like paying $20+ per transaction). It's got the 'first mover' mindshare advantage, but not much else. The high transaction fees make it very unappealing to businesses. In order for a crypto to be valid and useful as a currency, it's got to be cheaper to transact than your average credit card transaction, which is around 1-3% of the transaction value, usually paid by the business, not the customer.

      There are now more than 1500 cryptos out there and more are appearing all the time. Generally, to be useful, the crypto has to have a purpose. Not many do. Etherium seems set to inherit bitcoin's crown because it can't be subverted as easily and also operates as programmable money with smart contracts. Eth still requires a lot of electricity to mine, however, as do most of them. Nano achieves much the same goal as bitcoin, but doesn't require tremendous electricity to mine.

      See the mess for yourself: https://coinmarketcap.com/all/views/all/

      12 votes
      1. [5]
        DrDouchebag
        Link Parent
        Ethereum is not sound money. Monero is. Ethereum may have its place in the crypto world but Monero is the closest thing to actual digital money.

        Ethereum is not sound money.

        Monero is. Ethereum may have its place in the crypto world but Monero is the closest thing to actual digital money.

        1 vote
        1. [4]
          zmitchell
          Link Parent
          Why is Ethereum not sound money, and what makes Monero better?

          Why is Ethereum not sound money, and what makes Monero better?

          7 votes
          1. [3]
            DrDouchebag
            (edited )
            Link Parent
            This is a big question but basically in my opinion sound money needs to have 6 characteristics. Medium of Exchange - Is able to be used as an intermediary in trade. Unit of Account - Is able to be...

            This is a big question but basically in my opinion sound money needs to have 6 characteristics.

            1. Medium of Exchange - Is able to be used as an intermediary in trade.
            2. Unit of Account - Is able to be numbered and counted.
            3. Durable - Has a long usable life.
            4. Divisible - It can be divided equally into smaller units (You can make change).
            5. Portable - It is easy to carry or transport.
            6. Fungible - Each unit is capable of mutual substitution, meaning units are of equal value ($1 in my wallet is worth the same as $1 in your wallet)

            If it is going to be used as a storage of value it also need to have:

            1. Scarcity

            Bitcoin and Ethereum solve all of these except for #6. Honestly it is a little debateable whether or not ethereum is actually that secure due to the fact that it sacrifices security in order to have more uses. By being turing complete it opens itself up to not only more attack vectors but also more user error as can be seen by things such as the Dao hack that forced the fork of ethereum and ethereum classic. Even ignoring that, both Bitcoin and ethereum are both completely transparent ledgers. Because of this, coins can be tracked and blacklisted. The ability to blacklist coins makes each coin not the same as every other coin so it is no longer fungible. Technically fiat money is not fungible either because it has serial numbers on it, it is only fungible due to law.

            Because every transaction in Monero is private, every coin is equal and it is the only truly fungible currency. This also has the added benefit of people not knowing how much money is in your wallet. Imagine if every time you went to the gas station the clerk could easily figure out how much money you had in your checking account. Everytime you send Ethereum or Bitcoin to someone, that person could relatively easily estimate how much money you have by some simple blockchain analysis. You could get around this by making a new wallet and transaction for every transaction, and that might increase the difficulty to figure it out a little bit but even that is easily traced. I don't want everyone to whom I transfer money to be able to figure out how much money I have.

            Andreas Antonopolous sums it up best without even mentioning Monero

            12 votes
            1. [2]
              teaearlgraycold
              Link Parent
              How are Monero transactions private?

              How are Monero transactions private?

              1. cheers
                Link Parent
                Monero employs zero-knowledge proofs to obfuscate transaction history-- the ledger is not openly viewable, as in other cryptocurrency schemes. Here're a series of articles from Ethereum's founder,...

                Monero employs zero-knowledge proofs to obfuscate transaction history-- the ledger is not openly viewable, as in other cryptocurrency schemes.

                Here're a series of articles from Ethereum's founder, explaining how zk-snarks functions: https://medium.com/@VitalikButerin/quadratic-arithmetic-programs-from-zero-to-hero-f6d558cea649

                1 vote
      2. Natanael
        Link Parent
        All PoW based mining systems are equal in the long run in terms of energy

        All PoW based mining systems are equal in the long run in terms of energy

  4. [5]
    DrDouchebag
    (edited )
    Link
    What people don't understand is that the power consumption of Bitcoin mining is tied to 1 thing: its value. It has nothing to do with network size or number of transactions, etc. The price of...

    What people don't understand is that the power consumption of Bitcoin mining is tied to 1 thing: its value. It has nothing to do with network size or number of transactions, etc. The price of Bitcoin must always be greater than the electricity cost to mine it or else miners will stop mining it.

    Therefore if you think mining Bitcoin is an issue you either need to raise electricity costs or lower the value of Bitcoin. Counter-intuitively, banning Bitcoin and or mining will do nothing but temporarily lower the price but long term raise the price. Bitcoin arose from people being fed up with the centralization and censorship of money.

    The solution is to have a currency not centralized by one authority OR to have multiple competing currencies not tied to any government control. If the US actually had sound money, the price of Bitcoin would plummet because there would be no point in using it. Unfortunately governments will never give up their tight control of monetary supply so Bitcoin is here to stay.

    Bitcoin is a good thing in the face of oppression, just ask Venezuelans. If you think the US is immune to something similar happening (even if not to the same extent) then you're not paying attention.

    8 votes
    1. [4]
      seila
      Link Parent
      So which is it? Bitcoin is the tool to fight oppressors and therefore is too valuable to dispense with, or Bitcoin is just a commodity that will go away the minute people price KWh properly? Also,...

      So which is it? Bitcoin is the tool to fight oppressors and therefore is too valuable to dispense with, or Bitcoin is just a commodity that will go away the minute people price KWh properly?

      Also, does Bitcoin even have the scalability/ease of production needed such that it can meaningfully make a difference in the case of oppression? It doesn't even look to be working for Venezuela.

      1 vote
      1. [3]
        Dr_Douchebag
        Link Parent
        kWh are priced appropriately and Btc is too valuable to dispense with. It has it's limitations with day to day spending but is a great store of value if you're looking for another way to hedge...

        kWh are priced appropriately and Btc is too valuable to dispense with. It has it's limitations with day to day spending but is a great store of value if you're looking for another way to hedge from government intervention in money. It's also extremely liquid vs something like physical gold or land.

        1. [2]
          seila
          Link Parent
          It may be a way to hedge from inflation but in practice that's for a fairly tiny minority of people, even in the case of Venezuela (last year Forbes cited about 85,000 users...

          It may be a way to hedge from inflation but in practice that's for a fairly tiny minority of people, even in the case of Venezuela (last year Forbes cited about 85,000 users https://www.forbes.com/sites/realspin/2017/02/03/why-venezuelas-currency-crisis-is-a-case-study-for-bitcoin/#72b4136719b2 ). I don't see it scaling up much further than that without getting cracked down on (like it currently is https://www.newsbtc.com/2018/05/31/officials-in-venezuela-begin-confiscating-imported-bitcoin-mining-hardware/ ) and supposing it did scale up to support a meaningful part of the population it would go from the ecological concern it is to an outright tragedy. To compare, BTC uses way more energy per Bitcoin than the equivalent amount of production for gold https://digiconomist.net/bitcoin-mining-more-polluting-than-gold-mining .

          I struggle to see how the liquidity of BTC justifies its ecological cost. And if Venezuela didn't subsidize electricity costs, I doubt BTC would even be in the conversation. As best I can calculate using the article that OP linked, BTC is basically only viable in countries that provide electricity at prices that allow for this kind of use. US Bitcoin miners are only barely making a profit- assuming BTC is stable now https://99bitcoins.com/bitcoin-mining-profitable-beginners-explanation/

          So all that to say, I don't see the social value in BTC outstripping its inefficiency and limitations. It lacks scalability and the reality is that the governments can still intervene.

          1. Dr_Douchebag
            (edited )
            Link Parent
            It's more than just a hedge from inflation. The best way to think about it would be more akin to digital gold which isn't really a hedge to inflation but more like a short. If you're talking about...

            It's more than just a hedge from inflation. The best way to think about it would be more akin to digital gold which isn't really a hedge to inflation but more like a short.

            If you're talking about just the ecological effect, you should listen to Andreas Antonopolous' discussion about the economics of energy and Bitcoin (but all crypto) mining. https://old.reddit.com/r/Bitcoin/comments/7jdjc1/andreas_antonopoulos_flipped_the_energy/

            The real thing to understand is the only thing that justifies the energy expenditure is what the market deems the value of it being. The network and transactions could grow to x1000 or shrink x1000 but if the value stays the same, the amount of energy used to mine will be the same.

            So all that to say, I don't see the social value in BTC outstripping its inefficiency and limitations

            Then don't buy it. The energy expended with mining bitcoin will always follow the value and not any other metric, that's the nature of what drives the decentralization of Bitcoin. It's actually kind of genius and I recommend reading the white paper. https://bitcoin.org/bitcoin.pdf

            That being said, Bitcoin is old news because it's 100% transparent which kind of defeats the purpose of avoiding censorship so buy Monero.

            Edit:

            if Venezuela didn't subsidize electricity costs, I doubt BTC would even be in the conversation.

            You don't need any energy at all (the same as an email) to buy, sell and use Bitcoin, you only need energy to mine it which is really just a way of saying securing the network so nefarious entities cannot change the ledger.

            1 vote
  5. [7]
    Zlyme
    Link
    This is why Proof of Stake is becoming more the norm in the cryptocurrency community, whilst Proof of Work is looked down upon. Hopefully there is an even better consensus protocol someday.

    This is why Proof of Stake is becoming more the norm in the cryptocurrency community, whilst Proof of Work is looked down upon. Hopefully there is an even better consensus protocol someday.

    1. [6]
      Dr_Douchebag
      Link Parent
      PoW is not looked down upon. There is much discussion on /r/Monero about PoS and it's pretty universal that it leads to compromise in privacy and the problem of the rich getting richer. PoW...

      PoW is not looked down upon. There is much discussion on /r/Monero about PoS and it's pretty universal that it leads to compromise in privacy and the problem of the rich getting richer. PoW requires real world investment into mining equipment.

      The debate is still going strong and I'm on the PoW side. PoW will only use as much energy as people think crypto is worth. If people think the idea is worthless and stupid, people will stop using energy to mine it. The fact that people think it is so valuable means that it is probably worth the energy using to mine it to avoid centralization and censorship

      1 vote
      1. [3]
        Zlyme
        Link Parent
        That's a good point, thanks! :D

        That's a good point, thanks! :D

        1 vote
        1. [2]
          Dr_Douchebag
          Link Parent
          I like this site conversation vs Reddit downvoted into Oblivion. Don't get me wrong, I don't think PoW is the end all be all and I'm sure a better algorithm will come along, I'm just not sure PoS...

          I like this site conversation vs Reddit downvoted into Oblivion.

          Don't get me wrong, I don't think PoW is the end all be all and I'm sure a better algorithm will come along, I'm just not sure PoS is it.

          I also think the energy FUD is mostly a reason for governments to try and control it... I'll take off my tin foil hat now

          2 votes
          1. Zlyme
            Link Parent
            I agree! yeah it's only been nine years, and that’s just since bitcoin!

            I agree! yeah it's only been nine years, and that’s just since bitcoin!

      2. [3]
        Comment deleted by author
        Link Parent
        1. [2]
          Dr_Douchebag
          Link Parent
          To me, privacy and fungibility trump any sort of algorithm to be honest. I've just yet to see anything but PoW provide sufficient privacy

          To me, privacy and fungibility trump any sort of algorithm to be honest. I've just yet to see anything but PoW provide sufficient privacy

          1. [2]
            Comment deleted by author
            Link Parent
            1. Dr_Douchebag
              Link Parent
              The problem I've found is most devs are following the Zcash/PIVX method of privacy, which the main problems with it is that every private transaction takes an enormous amount of computing power so...

              The problem I've found is most devs are following the Zcash/PIVX method of privacy, which the main problems with it is that every private transaction takes an enormous amount of computing power so both of those coins have made private transactions optional. When I say enormous I don't mean the blocktime, I mean when you actually make a transaction a relatively new computer will freeze up for 2-5 minutes while making the actual transaction. Because of this both have opted to make privacy optional not mandatory which vastly decreases privacy and (imo) more importantly removes fungibility.

              Fungibility is one of those things people don't think about but I'll give you an example of its importance. I've been in Bitcoin for a while and a few years ago I bought some from an ATM. I then transferred it to a private wallet. A few months later I bought a shirt off of Overstock with Bitcoin. It was flagged as "Questionable" because using whatever blockchain tracing algorithm they had 2 years ago they couldn't track it to an exchange. They not only locked the funds... they transferred it to coinbase and I had to go through coinbase to get my $20 back... That was 2 years ago and for $20. Privacy and fungibility are just about the biggest issues that aren't talked about yet because most people haven't hit those roadblocks yet.

              1 vote
  6. Thor
    Link
    Bitcoin is fascinating. It solves the previously unsolvable problem of money - how to safely transact with someone I don't trust. For all it's flaws, this single achievement is unparalleled in...

    Bitcoin is fascinating. It solves the previously unsolvable problem of money - how to safely transact with someone I don't trust. For all it's flaws, this single achievement is unparalleled in this history of money.

    I can't tell you if it will survive it's flaws, including high energy costs, but I think to be fair, we must compare apples to apples. What are the energy (and other) costs of the current banking system? Do you count fuel of truck to literally drive around to banks with dollar bills? Do you count costs of workers to commute and the energy to feed them? Energy consumption of Bitcoin is much easier to measure than the complicated system of modern banking. But a true comparison would consider these costs too.