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Bitcoin Will Burn the Planet Down. The Question: How Fast?


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The cost of bitcoin.

It takes 17 megajoules to mine a dollars worth of bitcoin, but just 4 megajoules for a dollars worth of copper.

Credit: HOTLITTLEPOTATO

Max Krause was thinking of buying some bitcoin, as one does. But Krause is an engineer—mostly he works on modeling greenhouse gas emissions from landfills—so his first step was to run the numbers. He looked at price, of course, but also how fast the world's bitcoin miners create new bitcoins and the ledger that accounts for them. And he looked at how much electricity that would seem to require.

"I thought, man, this is a lot of energy," Krause says. "I thought, it can't be true that people are using this much energy. But it is."

Krause's calculations aren't just back-of-the-envelope noodling, cryptocurrency blog trolling, or white-paper crossfire. His calculations of how much energy—and planet-warming carbon emissions—the top four cryptocurrencies might be responsible for appears in an article in the journal Nature Sustainability today, joining a growing canon of peer-reviewed and rigorous work trying to put numbers to a problem the cryptocurrency world has been grappling with for years: How much energy blockchain-powered currencies consume, and how much does the answer matter?

Whoever Satoshi Nakamoto is, the genius of his, her, or their idea for bitcoin—published almost exactly a decade ago—was in solving the key problem with digital currency: You can generate more by just copy-pasting. Nakamoto's idea was to indelibly timestamp every transaction on a continuing chain. Do some really hard math—specifically, find a number that you can "hash" with an algorithm called SHA-256 to produce an answer everyone on the network agrees is right—and you not only create a new block in the chain, but you also get a reward: bitcoins. That system is called "proof of work," as in, you have to prove you did the math to get the money.

In their new paper, Krause and his co-author follow, at least for its first half, what has become in the past few years a fairly standard method. It starts by interrogating the blockchain network or aggregation websites for how many of those calculations happen in a given amount of time—every day, or every second. That's the hash rate. (Krause says in August 2018 that was 50 quintillion hashes per second on Bitcoin alone.) Then you find out how much energy the top-of-the-line mining computers use, often in joules per hash. That measurement is trickier, for reasons I'll get to in a moment. Multiply those together and you know how much power the network is using.

With that number in hand, you can figure out how much electricity a cryptocurrency consumes. It's 3.6 million joules to 1 kilowatt-hour. Past estimates for Bitcoin have ranged from 4 or 5 terawatt-hours per year up to 44 TWh/yr, as much Hong Kong used in 2017. Krause says it's more like 8.3 TWh/yr, roughly the energy use of Angola.

But Krause went further, adding estimates for power use by the three next-most-popular cryptocurrency networks—Ethereum, Litecoin, and Monero. Tally that up and ballpark the dozens of smaller entries and you basically double the number, 16.6 TWh/yr, putting cryptocurrency electricity use on a par with Slovenia (with an eye on surpassing Cuba).

 

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