Bitcoin mining is a power-intensive process. However, mining gold apparently requires twenty times more energy in comparison. This is according to Long Hash. However, it is the bitcoin mining power consumption that has led environmentalists to spiral into moral panic.
The industry particularly drew significant attention from the masses after the bitcoin price explosion that occurred last year that sent mining hashrates soaring. The crypto mining fever that followed caused an exponential rise in processing-difficulty, subsequently pushing up power consumption and hardware requirements.
To arrive at the figures, Long Hash used two methods to estimate the current power consumption for bitcoin mining. Two approaches were used find an average figure, which was about 4,344 MWh.
At this rate, bitcoin mining is estimated to cost about $4.3 billion annually. This is while taking into account average mining device efficiencies, with the Antminer S9 as the benchmark and older models being assumed to be working at about 25 percent less the average efficiency.
To come up with gold mining figures, the site looked at records from the Barrick Gold Corporation. It is the biggest gold mining corporation in the world. At an assumed rate of Barrick’s $794 cost/oz, it apparently costs about $70 billion a year to mine gold. There are also additional energy costs attributed to the gold refinery processes and the physical transportation of gold to clearing houses and brokerages.
That said, the cryptocurrency market is currently estimated to have a market capitalization cap of approximately $200 billion, whereas the gold market is valued at about $8 trillion.
Bitcoin Mining Not Likely to Lead to Increased Carbon Emissions
Critics and environmentalists have exclaimed in horror at the bitcoin mining carbon footprint, which paints a worrisome picture. However, according to Dr. Katrina M. Kelly-Pitou PhD, Manager of Strategy and Business Development for the Center for Energy, bitcoin mining consumes a lot of power, but it is not exorbitant.
For example, the banking sector consumes about 100 terawatts of power every year, whereas bitcoin mining uses only about 57.5 terawatts annually. She highlights that the development of more efficient technology and the move towards cheaper, renewable power sources will help suppress carbon emissions in the industry, even with skyrocketing energy requirements.
As things stand, bitcoin enthusiasts and mining farms are migrating to countries with cheap, renewable energy sources. Mining companies are also acquiring hydroelectric and thermal power stations for their operations to cut down costs. These factors, she argues, will ultimately reduce bitcoin mining’s carbon footprint.
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