The Bitcoin network could really use up 0.5% of the energy in the world by the end of the year. It could cost way more to mine when compared to any other currency and this could stop the whole thing from really being profitable. These figures come from a brand new commentary that was published today. Alex de Vries is a financial economist and he is also a blockchain specialist. He has carefully worked through a number of data points and even the Bitcoin mining computers that are present. The energy consumption that these computers use is incredible and the numbers are really outstanding as well. They are going to arrive at the lowest bound for energy consumption of the network and it currently adds up to 2.55 gigawatts. This is less than the energy consumption of Ireland, and by the end of 2018, De Vries calculated that based on the data and the mining operation, this could easily double. A statement has also been released and this shows that it could easily use up over 0.5% of the energy consumption in the world.
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If you are lost in the woods then the best chance of you finding your way out would be for you to use a tiny magnet, or a compass. There are problems with this, and there are also problems with Bitcoin as well. The problems with Bitcoin come from an environmental standpoint. De Vries showed that it also presents a problem for Bitcoin miners themselves, and it could be too expensive soon enough for the whole thing to stop being profitable. So why is Bitcoin using up all of this energy? The truth is that you need to understand how the network works if you want to get the best result out of this. Bitcoin, ultimately, is a peer to peer currency. This means that there is no central agency that is able to record who has what or even what changed hands and when. For this reason, Bitcoin users really do rely on a shared and time-stamped record. This shows all of their transactions and it also shows the record as a whole. The problem here is that it is all on a shared network and if you were to carry on with this then the whole thing will quickly become out of control. Even if thousands of computers all made a very competitive effort, they would perform quintillions of calculations every single second. Of course, when you get a computer to try and solve a math problem then this will give it the chance to try and form the next block on the chain. Every 10 minutes or so, the winner is rewarded with 12 and a half Bitcoins. The value of this really does depend on the exchange rate, but it isn’t hard to see how much money can be made from all of this.
So when you look at those incentives, you can see that bitcoin miners have filled up their warehouses with computers that are completely dedicated to mining and that could easily pose as a problem. You may find that these computers, even though they are efficient, they still do need a huge amount of power in order to run and details of how many computers like this are made in a year or even the mining operations that are used can have a significant impact on this. You also need to find ways to keep these computers cool as well, and this can cause real problems in the future. De Vries on the other hand seems to think that he has found the secret to try and find all of the data needed to work out how much money Bitcoin is actually going to make even though it is using up so much energy.
He believes that this really does mark the secret to finding all of the data needed to make the calculation and that this is the first time anything of this sort has actually been created. He believes that if bitcoin miner manufacturers are carrying on as they are then this could be a valuable addition to have in the toolkit and that this could also help to sustain the energy trends for bitcoin as well. De Vries has also gone on to say that when mining does become more costly, that this doesn’t mean that miners will eventually stop. Some miners may even go as far to try and figure out how they are going to mine bitcoin at no extra cost and they may even try and steal energy to do this as well. When something like this happens, this would truly be the end of bitcoin as nobody would want to invest in it and nobody would want to take the time to learn the trade as well. Of course, there is no telling whether or not this will happen and there is also no telling whether or not this will have an impact on the cryptocurrency community either.