Bitcoin Mining Has Environmental Impact Due To Electricity Consumption

BTC or Bitcoin mining is an energy intensive process that consumes plenty of electricity. As a whole, the BTC miners will consume more electricity that will surpass Denmark's own consumption by 2020. Right now miners consume more electricity than certain countries like Haiti, and this is growing at a staggering scale as BTC becomes more valuable and the demand increases. This is part of the algorithm used in BTC mining, which makes computing hashes more difficult as more miners try to validate transactions for BTC. The increase in difficulty is part of PoW (Proof of Work), which requires the use of computing power to solve hash problems to generate a block that verifies a transaction. All this computing consumes a lot of electricity. The most power hungry hardware comes from the mining rigs which can draw upwards of 3 kW per hour of electricity. It's now estimated BTC miners are using up 31 TWh of electricity a year and the demand is 450 GWh per day. This is putting demand for the grids to produce more electricity, and in most countries it is produced by coal-based powerplants. This is creating an ecological problem with fuel consumption, which does increase the carbon footprint from this activity. There are solutions emerging though that will help reduce the carbon footprint.

This time is right for switching to cleaner and more renewable energy sources as the adoption of BTC and other altcoins increases. Other altcoins are considering a PoS (Proof of Stake) model to reduce power consumption since the protocol will not require energy intensive mining. If not, then this will be an unsustainable model in the long run and could even lead to collapse. It cannot be ignored that these activities will also outstrip what electricity is available, so it is better to move toward more renewable energy sources like solar and wind as a replacement for coal and high emission fossil fuels. A good example where renewable energy is being utilized is in Iceland, the site of some of the world's biggest mining rigs after China. In Iceland, BTC miners utilize cheap energy provided by geothermal powerplants. Geothermal power is not only cost-effective, but is reliable, sustainable and environmentally friendly. Though geothermal still has carbon emissions, the carbon footprint is reduced. Perhaps using renewable sources that don't emit carbon will be the most challenge for BTC mining.

Mining is not a permanent activity on BTC networks. China has recently begun to regulate BTC mining at the start of 2018. This is leading to miners seeking other locations where they can establish new mining rigs. It appears that the closer to the Arctic Circle, the better the location due to the colder weather. The cold helps to keep the environment at much more stable levels from all the heat the mining rigs produce. The heat can also be recycled in some cases, where the source of electricity is solar thermal or hydrothermal in nature. As for mining, after it's cap is reached or the last coin is mined, there will be no more mining activity for PoW. Instead it will be more about transaction fees, so the end of mining will eventually lower the demand for electricity. That will be very far into the future though at the current rate, because it is expected the last coin mined may be in the next 120+ years.