Bitcoin is a digital currency, which is helpful to receive and transfer money but mining BTC is not free. The Bitcoin mining process includes the use of sophisticated computers for creating bitcoins via a blockchain network. It is an expensive endeavor that impacts the resources and environment significantly.
How much electricity is used to produce a bitcoin?
According to a report, claims are made that bitcoin mining is responsible for 1% of energy consumption in the world. People from all across the world gather and answer the same math puzzle using computers to mine a bitcoin. After every 10 minutes, there is a puzzle solved and some bitcoins are rewarded to the problem-solver. Then, a new math problem gets generated and the entire mining process starts again.
More people are interested in the cryptocurrency landscape because of price surges. They either try to buy BitCoin from exchanges or choose to mine. More people involved in the network and trying to solve the math puzzle adds to the difficulty level.
The software designed to mine bitcoins offers 10 minutes to everyone involved in the network to solve the math problem. Puzzle has a difficulty level based on the number of people trying to answer it.
The time to generate bitcoin does not differ, but it is the computing power trying to mine bitcoins that differs. The more people integrated into the network means more computer power use, so more electricity spent on every bitcoin produced.
Bitcoin cost calculation
To calculate how much electricity is used to power the Bitcoin network depends on every second taken to answer the math puzzle. Each puzzle is called ‘hashes. There are millions [megahashes] and billions [gigahashes] of hashes. In 2018, computers on bitcoin network statistic read 342,934,450 gigahashes/ sec.
Myriads of different mining computers are available, but many focus on ASIC mining computers. Application-Specific Integrated Circuit makes use of less energy to do the calculations.
To mine, a single bitcoin takes years, even with specially manufactured mining machines. Therefore, hundreds of mining machines are used simultaneously. They fill their whole warehouse with racks filled with ASIC cards. Therefore, a lot of energy gets consumed generating one bitcoin. The companies that use plenty of ASIC miners claim that for every gigahashes per second one-watt power gets consumed for doing the calculations to mine bitcoins.
“Mining difficulty’ is a variable that impacts the mining power consumption. More mining power means an increase in mining difficulty level. The reason it takes time for one card to mine bitcoin is because the bitcoin network is dominated by professional miners.
It is studied that the bitcoin network operates at 342,934,450 watts [343 megawatts]. According to a survey, on average 1.2 kW power is consumed in US households. The 343 megawatt is sufficient to power 285,833 households.
Isn’t’ this a lot of energy? Blogs and media outlets have produced varying estimates associated with bitcoin mining’s electrical consumption. Energy consumption is a crucial element of the system. Bitcoin price and energy needed to mine it creates stability in the bitcoin network.