Bitcoin is fake so fake story of fakeness.
False. Mining is what uses electricity (and water) in bitcoin, not transactions. Adding more transactions does not add to the cost. Calculating consumption per transaction is misleading as the two are not related.
What does add to the cost is complexity, and complexity is calculated based on number of miners in the network in order to achieve the sweet spot of 1 block every 10 mins (if i remember correctly). If there’s a lot of competition, each miner will have to use more electricity to win.
Finally someone that get’s it
Not only is the science underlying all these findings completely non-existent, they only “guesstimate” what the water usage of what every thing that uses water is; then blindly divide that by the transaction volume per time period.
Not only is that method highly flawed; it’s incorrect. Computers do more than mine crypto; and 1 transaction typically costs not even 1 tenth of a percent of most miners’ overall computer resources. This is due to the fact that many miners are utilizing either a GPU or FPGA style device to power optimize and optimize the mathematics necessary to secure a transaction.
That might have been true a decade ago. But GPUs and FPGAs have long been obsolete for mining Bitcoin.
Mining is happening on custom silicon in large-scale operations. They specifically observed several of those large-scale operations in multiple nations and extrapolated out. I don’t see how that methodology is flawed.
Because of these transactions, many countries, such as the United States, could face freshwater shortages if the currency becomes more widely adopted.
False.
Blocks get mined (secured) with the same amount of power no matter the number of transactions in each.
Interesting that an article like this would come out right as Bitcoin’s value is going up and the US SEC is considering approval of several Bitcoin ETFs.
These calculations are a bit off IMO. They factor the total amount of mining and divide it by the number of transactions.
However, the amount of mining is not dependent on the amount of transactions.
I’m not a fan of bitcoin due to the wasteful proof of work mechanism but ‘blaming’ the transactions is not really fair IMO, especially because people don’t really use bitcoin as a payment method anymore. It’s just used by speculators now.
Wasteful and unsustainable.
However, the amount of mining is not dependent on the amount of transactions.
Entertain my ignorance on this for a second, but isn’t there some sort of dependence here? Like not a strictly casual dependence, but if transactions were, say, to magically halve for a few days, would that not affect the mining required and thus the total energy expenditure of the mining?
(Obviously the limit case would show this to be true, in that in the absence of any transactions at all, mining would cease. But I’m after something a bit more clearly casually related, somewhat like supply and demand in the marketplace – consumption of beef driving more supply and more methane, e.g.)
No, transactions piggyback on the mined blocks but if there are no transactions mining still happens.
I see. But in the limit case where just everybody decided BTC is nonsense and stopped transacting entirely, while mining could continue, eventually it would die out, right?
So in a sense, do transactions not drive the need for mining? If that’s the case, the connection isn’t directly casual so much as one of complicity. Does that make sense or am I still barking up the wrong tree with this way of thinking?
It’s a necessary sacrifice to push more ponzi schemes
It’s actually a scam pushed by Big Water to get you to use more water and line their pockets.
Ok thats not even remotely accurate. wtf is this clickbait shit. You can argue that bitcoin is bad for the environment but if you’re gonna invent statistics at least make is plausible.
Ethereum transactions are claimed to use about 1-22 Wh per transaction. Not sure where the wide range comes from, but at least it’s quite a lot better then Bitcoin’s ~700-2000kWh per transaction. Ethereum is comparable to how much a credit card transaction is said to spend, although those figures only take into account power needed for their computer systems. Blockchain currencies replace a lot more infrastructure than just the computer systems, so I think it’s reasonable to say that Eth2 is more energy efficient than credit cards.
That’s not enough to make it a replacement for credit cards yet, but it’s a good lowest of the low barriers to be crossed to qualify as a replacement.
In a few years, we’ll probably be spending a huge amount of power for AI also, and there doesn’t seem to be any Proof-of-Stake -like technology to help with that. Good times.
Lol
Indeed, sir.
700kWh per transaction? That’s absurd amount of power. That’s 70 EUR of energy per one transaction at current (EU) exchange price.
Is there anyone here knowledgeable enough about this issue to say whether those numbers are correct, or just an overestimate? It feels wrong.
It’s incorrect. I would comparing to fuel consumption in a car based on how many times you turned. If you make more turns on your way, it would seem your car is more efficient, when in reality there’s very little relation between turns and fuel usage, just like there is little relation between number of blocks mined and transactions.
The number varies a little bit (I’ve seen estimates 600-1200 kWh) but this is well within an order of magnitude of being correct. It’s the nature of the competitive mining network and the proof of work system: if you can spend more computing power (i.e. energy) than everyone else there are lucrative mining rewards to be had. At the same time adding more computing power to the network doesn’t add more transaction processing power, because mining difficulty is constantly adjusted to keep the speed more or less constant.
This naturally leads to exorbitant power consumption per transaction. Note that most of this power is not being purchased at EU exchange prices (mining naturally moves to where electricity can be had for cheap to maximize profits).
I just hope bitcoin will finally die. It’s literally just wasting absurd amount of energy, only to allow scammers to scam billions of dollars from victims, and regular people to steal from eachother by investing into it. I mean, if the only use of bitcoin by now is for speculation and investment, then it means that any dollar you made, you literally stole from someone else who will be left with useless bitcoin once it’s all over. There’s no value, and with the ledger getting bigger and bigger, and bitcoin more expensive to mine, it will eventually be worthless. And we all know it, so anyone who makes thousands of dollars, there’s someone who probably financially ruined himself by making a wrong and stupid investment at the wrong time.
I hate crypto so much :D.
You can exchange it for goods and services in the same way as the dollar. Which is the goal of it in the first place. Disregarding the cost for the sake of this point, it functions in a similar way as the dollar, which you could argue is also just used for speculation, but it would be equally inaccurate. Then there is describing bitcoin as all of the cryptocurrency ecosystem, which is also incorrect. It’s an evolving technology, and the system bitcoin uses is legacy and expensive, and is currently being kept alive by being the first in the space, money interests wanting to keep it dominant because of investment and a horde of cultlike followers. However, in the ethereum ecosystem, transactions keep getting cheaper through layer 2 protocols and upgrades to the system. It uses proof of stake which is vastly cheaper. I think there certainly are valid arguments against cryprocurrency, but the stuff everyone keeps NPC copypasting is generally nonsense.
You are right I shouldn’t have equaled bitcoin with the rest of the crypto ecosystem. While most crypto is utter scam, it’s true that there have been some slight advances here and there, and there are coins that may be actually useful for some cases, mostly Monero and I suppose Ethereum. I’d still say that crypto has done more harm than good in the world, and I say that as someone who’s really focused at privacy, care about it a lot and have invested significant amount of time and effort into staying as private as possible.
But it’s great that Ethereum managed to solve most of the issues with Bitcoin - unless I’m mistaken, it’s not really used for investment speculation, and if it managed to keep the energy requirements low, that’s good. But last time I remember researching about blockchain (it was few months, so feel free to correct me), isn’t it running into serious issues with ledger size, that makes it infeasible for long-term (decades) of use, without sacrificing some of it’s guarantees? Which is one of the main issues with blockchain tech in general, that I don’t think has been solved so far.
It’s a process. There certainly are a lot of scams, and correct regulations need to be in place. It is a tool used by people who do harm, though it is not the cause of harm. At the same time, it’s helped a lot of startups innovate in non-traditional ways, and i think a global and affordable currency that is not tied to the local currency has the potential to help a lot of people. Ethereum in theory should be more stable in terms of price as it keeps being minted and destroyed trough use of the blockchain. You can speculate with it, or the ERC-20 tokens in it’s ecosystem. Ledger size is an issue i’ve had to deal with myself setting up a node, but it’s also an issue that can be fixed in several ways if it looks like it could become a significant enough issue, as they did with PoW to PoS.
I think it’s hard to measure what good and bad crypto is done when you only hear about outragous corruption and crime but not how the everyday person uses it. I use it in a way that helps myself and others and I’m no north korean drug lord scamming people.
You can exchange it for goods and services in the same way as the dollar. Which is the goal of it in the first place. Disregarding the cost for the sake of this point
But you can’t disregard the cost. No big box retailer is going to start accepting BTC transactions at the point of sale. It takes too long, and is too resource intensive. So you’re essentially limited to secondary markets or person-to-person transactions where seconds in processing the transaction don’t count. Not to mention the volatility of the exchange rate. A business or a government aren’t going to accept that the currency they accepted today could potentially be worth half its value tomorrow. Without some sort of major catastrophic world event, something like that isn’t going to happen to the dollar. That kind of shit destabilizes entire economies and nations.
There’s also the issue of reputation. Regardless of validity, cryptocurrency is seen as something used for criminal activity. If your local city government said they’d start accepting BTC for your water bill or trash bill, the majority of average folk are going to think “that stuff people buy drugs with on the Internet?”
BTC has never been and will never be viable as a mass market currency system.
I agree, BTC is awful. But I also think its just a starting point for something that has the potential to become much better.
It’s an overestimate. Right now the total cost per transaction is around 82 US dollars, which at current exchange rates is 75 Euros. That cost covers everything - electricity, rent for the building, salary for staff, taxes, depreciation of mining equipment, and whatever profit is required to keep the miners in business. I don’t know what proportion of miner costs actually goes to electricity but I expect it’ll likely be much less than 70 Euros.
Perhaps someone got that 700 kWh figure by doing the reverse calculation - looking at how much a transaction cost and then assuming that all goes toward electricity.
They are insanely off, yes.
As tradition I won’t read the actual article and only comment on the headline - while BTC is a massive energy waste, it seems unlikely that each transaction would waste so much cooling water. Maybe each mined block, but each block should contain thousands of transactions
I do wonder how this compares to current payment processors (Visa, Mastercard, Paypal, etc)
What I found… 1 Bitcoin transaction takes ~700 kWh of power, where as 100,000 Visa transactions use ~150 kWh.
https://www.statista.com/statistics/881541/bitcoin-energy-consumption-transaction-comparison-visa/
But does it account for manufacturing of the plastic cards, delivering it to the user, and the added expense of the extra weight when carrying it around? /s
I don’t think that’s really equivalent. They are averaging the energy usage of mining and usage across the number of transactions. The overwhelming majority of that energy would be on mining.
What is the equivalent of mining in terms in VISA transactions? How much energy does that use? What is the marginal cost of a Bitcoin transaction? If you’re including Bitcoin mining in your per-transaction costs, shouldn’t you include the entire operating costs of VISA, along with the partners they rely on like banks, mints, and even physical mines?
Bitcoin is not a 1:1 equivalent of anything in the traditional financial world, so coming up with a meaningful comparison is difficult. It’s a little bit currency, a little bit transaction processing, a little bit “mining”, and a little bit banking. Despite the hype, I don’t think it’s a full replacement for any one of those things.
Even when you throw in the entire electrical consumption of Visa down to the last lightbulb and ATM you’re going to be dwarfed by bitcoin. Mining is inherently necessary for bitcoin to process and records transactions, but even if it wasn’t the scale of waste just kills bitcoin. Running a few office buildings to serve hundreds of millions of people just can’t compete on a per transaction cost. And comparing the energy needed of one way to send money online to another way to send money online seems fair enough to me.
For scale, in an electric suv like the Ionic 5, 708kwh is enough to drive from California to Florida, and that’s necessarily for every single transaction.
You can’t have a transaction without mining. Mining is the work done to solve a batch of transactions, so the exact cost of a transaction is easy to determine provided that you don’t include the cost of plant (buildings and IT to run the miners, though this is usually very minor compared to the actual calculation consumption). Each block contains (typically) between 3000 and 4000 transactions and is solved every 10 minutes. As of today, it takes 2.6GWh to solve a block, given the current number of miners (137TWh/yr per https://digiconomist.net/bitcoin-energy-consumption), which is 744kWh per transaction at 3500 transactions per block.
The cost of a Visa transaction is more difficult because there are people involved and other plant costs (buildings to house the people who work for Visa). The actual cost to process a Visa transaction, in direct transactional power usage, is trivial because a Raspberry Pi can “process” hundreds of thousands of transactions a second locally - it’s literally a couple hundred bytes of login/query/reply data, and adding or subtracting from a ledger which is mirrored to distributed servers. Distributed across a server with enough transactions to keep it busy it’s probably a few hundred milliseconds on 1/8 of a 50W processor - call it 0.001Wh at the server, which is the equivalent of the 700kWh per bitcoin transaction. If we say that there are 10 machines all doing the same virtual transaction on each physical transaction (incl. POS, backup, billing, etc) and we figure a 5:1 cost of total power (a/c, losses, memory, storage) then we’re all the way up to 0.00005kWh (0.05 Wh, or 180 watt-seconds) per transaction. That means that the overall cost for visa to process your charge is 1.5kWh/0.00005kWh for the computers or 30,000:1 due to humans being involved in the process.
Here’s the thing, though: Bitcoin gets harder (more compute intensive) as time goes on, and the rate of increase is faster than the ability to solve, on a Wh basis. IE - Bitcoin transactions will get more expensive over time unless bitcoin changes their code - and there is always resistance to that because there is a financial disincentive to reduce the work in Proof of Work systems. This is mitigated on other blockchains by using Proof of Stake, but that has other implications. Visa, otoh, is taking advantage of AI and drops in processor and storage costs to lower their per-transaction cost because there is a financial incentive to reduce processing costs as the fees charged are fixed (nominally 3% of the transaction cost) and anything left over is profit.
Bitcoin transactions will get more expensive over time unless bitcoin changes their code
other events could precipitate a decrease in power used per bitcoin transaction.
Again, it would take a substantial change to the code or reality. The options are to change the block size (more transactions per block), alter the difficulty curve (which is intended to limit growth in the limited bitcoin supply), alter the way blocks are solved (massive theoretical mathematical breakthrough or, possibly, a move from asic to quantum computing), or switch away from proof of work. The first increases the storage of the blockchain (substantially for a substantial reduction), rewrite - and get approval - to change the difficulty steps which had been a hallmark of the system, the third is magical thinking, and the fourth completely undermines the egalitarian ethos of the coin.
I’ve heard of no substantive move on any front to alter the plan because, for now, it working. And the true believers are generally libertarians who have faith that market forces will correct any shortcomings organically. This usually results in everything working perfectly right up until it doesn’t, at which point the wheels come off and the bus slams into the class of kindergarteners crossing the road.
the network is self-adjusting. if hash power begins to decrease, the network will decrease difficulty to maintain the target of 10 minute block times. lots of things could lead to decreased hash power. the whole network could be run with a cleverly configured raspberry pi
the whole network could be run with a cleverly configured raspberry pi
Which would defeat the entire purpose of a distributed blockchain. I’m ribbing you, of course, on that ;-) Bitcoin was not built for efficiency and the very basis of distributed proof of work trades efficiency for security. The more “successful” it gets, the larger the incentive to waste power in a fight to win each block reward becomes - by design.
It seems I have fundamentally misunderstood how bitcoin mining works. Thanks for the correction.
I’m having a hard time wrapping my head around this. If the marginal energy cost of a transaction is 744kWh, shouldn’t the transaction fees be astronomical?
The reward for mining a block is over a quarter of a million dollars these days. $250k / 4k transactions = apx $62.50 per transaction. Around $8 is from the transaction fee from the sender, the other $54 is from the block reward minted out of thin air.
Yeah, at current electricity prices where I live that would be just under £300,000 per transaction. Doesn’t seem right.
Edit: as pointed out, I was out by a factor of 100. Electricity costs 40p per kWh here.
You sure you have the magnitude right on that? From a quick search, I think it should only be about £200 in e.g. London, with similar prices in big cities across the US. I thought those were relatively high prices to begin with.
You’re right. It was late.
Well my understanding is that visa, MasterCard ECT. Are far more efficient in terms of energy and transaction time when compared to Bitcoin and Ether. Visa uses about a quarter of the power per 100,000 transactions.
So I would assume that would mean fewer data center computers to cool and therefore less water used per transaction
Sorry, I’ve not kept up to date with crypto, but wasn’t ethereum due to move from computational mining to staking? Wouldn’t that be a lot more efficient, or is that not a thing yet?
ethereum moved to proof of stake sometime back. BTC and I think a few other (very) minor cryptos still use proof of work which is where the significant power usage goes. Not something I track but I believe the vast majority of non-BTC cyptos are proof of stake or something not proof of work anyway and BTC is the only one that uses proof of work and is used at all. That might not exactly be technically correct but it is in the practical realm.
i strongly urge skepticism when reading articles about the environmental impacts of bitcoin. I am not saying that bitcoin is a sensible use of resources - rather that the claims made about the environmental impacts are often overstated and based on models extrapolated to absurdity. For example, see https://doi.org/10.1038/s41558-018-0321-8 where Mora, Camilo et al suggested that “Bitcoin Emissions Alone Could Push Global Warming Above 2°C”. Then read Implausible projections overestimate near-term Bitcoin CO2 emissions by Masanet et al.
Again - the environmental impacts of cloud computing in general and bitcoin in particular are something we should be concerned about. But there are a number of researchers who have made wild claims that should be treated with a critical eye.
(Checking if outbound federation is back)
Yeah, if they had said 10 gallons, I’d buy that, but a whole swimming pool of water would be worth far more than a transaction fee I’d expect.
Yeah, generally miners will set up in places with cheap electricity. And excluding places like Azerbaijan, those sources are generally renewables.
Yeah. Right now, the cost of a Bitcoin transaction is around $65 US. That price includes all of the expenditures that the miners have made on resources (electricity, water, rental costs for the space they’re using, hardware depreciation, etc.), as well as whatever bit of profits it takes to keep miners in business. That puts a cap on whatever environmental impact the transaction is having.
So if it costs $65 for a transaction then why isn’t that the transaction fee? people would be loaing money if cost is more than the fees
Bitcoin is inflationary, it’s generating new Bitcoin with every block and issuing that to the miners. That new Bitcoin combines with the transaction fees to pay the miners.
Bitcoin is deflationary. There is a hard limit on the total number of bitcoins that will ever exist. Every so often, the reward for mining a block is halved. Eventually there will be effectively zero reward for mining at all.
Maybe in the long run. However, when you want to actually calculate how much each transaction costs, you need to account for the fact that right now Bitcoin is inflationary. It won’t stop issuing new tokens until around 2140 AD, assuming no hard forks happen to modify that issuance strategy in the meantime.
So mining is the bulk cost not the transactions. because my last bitcoin fee was like $10 or something
Yes. If you’re wanting to know how many resources mining a transaction takes, that’s the value you need to look at. The block reward effectively goes into subsidizing the transaction fees that are being paid.
ok then just use salt water. You’re welcome nerds!
These data centers consume water for cooling systems
How does a data center consume water? Doesn’t every liter that enters as freshwater leave as slightly warmer freshwater? What am I missing here?
Swamp coolers.
Fans blow over water to lower the pressure, causing evaporation to occur at room temperature.
Evaporating water absorbs heat from its surroundings without raising the water’s temperature as it undergoes a phase change. It absorbs nearly 20 times more heat than it would from being heated from 50 degrees F to 100 degrees.
Some of the water is evaporated so it doesn’t leave as a liquid.
That’s unlikely in a closed heat exchange system. Maybe some additional evaporation because the water is slightly warmer. But unless I’m missing something, it seems very misleading to suggest that a Bitcoin transaction uses 16 kilolitres because of evaporation. Napkin math, it would require about 10 megawatt/hours of energy to evaporate that much water (please correct me if I’m wrong). I’m not a Bitcoin fanboy, I just don’t like BS.
Some water is used in humidifiers, there are also systems that use direct evaporative cooling where the water is eveporated to cool the hot air. There are probably other ways the water is lost.
AWS’ preferred cooling strategy for its data centers is known as direct evaporative cooling. In this system, hot air is pulled from outside and pushed through water-soaked cooling pads. The water evaporates, reducing the air’s temperature, and the cool air is then sent into the server rooms.
Even if so, does evaporating cause it to exit the water cycle?
These cooling systems remove and release all of the heat produced inside a data center – from servers, IT equipment, and mechanical infrastructure – into the outside environment, through a cooling tower that uses a water evaporation process.
It goes outside and eventually becomes rain.
someone from a totally different thread mentioned that the water can’t stay in the system because of whatever mineral stuff from the cooling pipe/anti-algae/anti-corrosive has to leave the system after certain cycles. So unless you have a treatment plant down stream it’s not exactly “drinkable” freshwater. (and I doubt water regulation would allow that to happen.)
The consume here means that water is not usable for other application. How? I don’t know, maybe it can be used for power wash?
It probably is still a lot easier to make potable than sewer water or even river water though. At lease you know exactly what contamination is in it.
Water used to cool data centers is either consumed, meaning it evaporates into the atmosphere via the data center’s cooling towers or discharged, as industrial wastewater, usually to a local wastewater treatment plant.
It can’t just be dumped into a river, has to go to a sewer treatment plant.
edit: They do recirculate it, but it eventually needs to be replaced. And some facilities have treatment plants on site, so doesn’t necessarily needed to go to a sewer treatment plant.
Aquafers do not refill as quickly as industry sucks them dry. It’s not just a Bitcoin or even a cloud computing problem, but the author is using this fact to make Bitcoin look even more ridiculous.
The people that care about this sort of thing are incapable of fixing it- and the people that could fix it- don’t care.
My advice? Get used to it. This is the new normal.
Or make it illegal. Why waste so many resources on something that doesn’t produce any value for society?
