New Coinshares Study Touches on Electricity Being Wasted but Bitcoin Mining Makes it Valuable
As many of our readers may already know, one of the biggest issues that many people all over the world have with Bitcoin [BTC] is that the currency consumes an obscene amount of energy during its mining process. To put things into perspective, keeping the global Bitcoin mining network going takes about 4.7 GigaWatts of power (a number which some analysts say could potentially power around 160 third-world nations yearly).
However, in the midst of all this, a new study by Coinshares has shown that while miners are currently running at a loss when trying to procure BTC— the mining process usually employs electricity that has been obtained off-grid (and would hence go waste if not used for the aforementioned purpose).
More On The Matter
According to the paper, the Bitcoin network is making use of existing electricity resources which are essentially surplus and would go unutilized (since the grids in question do not have the framework to hold so much power). This helps negate some of the different perspectives that have been pushed by a lot of people on the internet who keep claiming that “Bitcoin is doing untold harm to the environment”.
Also worth mentioning is the fact that the authors of the study claim that the network acts as an “electricity buyer of last resort”, which basically means that Bitcoin does not take away the power supply of any of its surrounding regions (thus not affecting the quality of life of the people living around these mining rigs at all).
“If demand for Bitcoin mining keeps increasing, its demand alone could facilitate opportunities for tapping highly productive renewables locations in areas that today would be uneconomically remote.”
According to recently released statistical data, most of the world’s ongoing mining operations are currently based out of the Chinese region of Sichuan. The location is perfect for altcoin-miners since the energy costs there are quite low (due to the presence of various renewable energy options in the area). In addition to this, the climate of Sichuan is quite cold and thus allows for massively reduced ASIC cooling costs.
“Based on historical data on energy mix and locations of cryptocurrency mining operations in China, we have shown that contrary to the common narrative, the vast majority of global Bitcoin mining capacity (minimum 77.6%) is running on renewable energy.”