The ugly truth behind the blockchain is that it consumes a lot of energy.
The amount of energy needed to make one bitcoin transaction is in comparison to one month of energy or electricity for a whole household.
This is enough to let the washing machine run for about 200 times.
Blockchain is an energy consuming phenomenon.
At this moment, keeping the blockchain running costs about 2200 megawatt. Compare that to the biggest power plant of the Netherlands that produces about 1560 megawatt.
One bitcoin transaction is 20.000 times more expensive than one credit card transaction.
Blockchain verifies every bitcoin and cryptocurrency transaction thru a lot of computers/blocks at the same time. This happens with a complicated algorithm that requests a lot of computing power from computers. Because all the processors run at 100%, the bitcoin transaction cost a lot of energy. That is why bitcoin miners get compensated for providing processing power. Miners therefore must consider the bitcoin price over the energy price. If the bitcoin price is higher than the energy price, it is lucrative to be a miner.
I know a friend who’s a cryptocurrency miner. What he told is that in his network of miner’s people are looking for countries where the energy is relatively cheap. The cheaper the energy the more profitable mining gets. My friend told me that he knows miners in certain parts of the world that have whole houses fully dedicated to mining cryptocurrencies. Not for themselves but for people in countries where energy is more expensive. Cryptocurrency mining is becoming more like a business that outsources its operations to countries where labour/ energy is cheaper.
Another side of mining cryptocurrencies is the heat generation. Because the processors run at full capacity they generate a lot of heat. Therefore, a mining rig can get costly or requires enough space between the processors/ video cards. If we can some transform the heat into usable energy, then being a miner becomes more interesting.
Blockchain may be the future, but the more we innovate into the blockchain world, the more power it is going to cost us. We must consider this constraint. And technology firms as well as programmes will have to seek less complex algorithms in order to make the Blockchain more sustainable.
https://www.rtlz.nl/tech/een-bitcoin-transactie-vreet-evenveel-energie-als-een-huishouden-per-maand
