According to the Cambridge Bitcoin Electricity Consumption Index, Bitcoin’s power consumption is closely linked to the financial costs incurred in mining as well as bitcoin’s expected price trajectory. According to the study, Bitcoin will use Electricity as much as Entire Pakistan for Crypto Mining in 2021. It is estimated that Bitcoin will use 91 terawatt-hours (TWh) of energy which is almost equal to the energy that Pakistan consumes.
The bitcoin network is burning more and more energy for mining bitcoins. The total power consumed by the bitcoin network has already crossed the 2020 consumption level. Last year, the electricity consumed by the network for mining bitcoins was estimated to be around 67 TWh. Currently, the consumption has already surpassed that mark and by the end of 2021, the mining looks set to have consumed 91TWh of energy.
Bitcoin to use Electricity as much as Entire Pakistan for Crypto Mining in 2021
The high use of electricity for mining bitcoin has also made it increasingly important to switch to low-carbon energy sources for electricity. According to the Cambridge Bitcoin Electricity Consumption Index by the University of Cambridge, bitcoin’s power consumption is closely linked to the financial costs incurred in mining as well as bitcoin’s expected price trajectory. In its FAQs on power consumption, it said that rising bitcoin prices and/or decreasing electricity costs generally lead to increased electricity consumption as less efficient hardware will be reinstated.
Earlier this year, Tesla’s Elon Musk had said that his company would stop accepting Bitcoin from customers for its electric cars amid concerns over the environmental impact of the virtual currency.
The rise of energy is caused by the increase in the price of bitcoin. When the price goes up, more bitcoin miners join the network with less energy-efficient machines to mine bitcoin that pushes the use of energy.
In the previous reports, it was stated that the high consumption of energy issue has been faced by China and Iran. It has forced them to shut down the many unauthorized Mining and that resulted in the wild swings in the Bitcoin price recently. The chief executive of Hut 8 Mining, Jaime Leverton, one of the members of the Bitcoin Mining Council, clarifies that the program aim is to “counter the noise and some of the misinformation that’s coming at the Bitcoin mining industry”.
She says they want to “rewrite the story around the cryptocurrency industry’s energy usage” to address concerns that the industry is not environmentally friendly. She insists that Bitcoin mining equipment essentially computers packed with specialized chips, is getting much more efficient and quotes a study showing 39% of the energy used in mining comes from renewable sources.
For More Information Please Check: Bitcoin and its Energy Usage
Source: Financial Express