3 ms·

Quick back of the napkin math suggests that the kwh numbers are the right order of magnitude (surprisingly to me)... work below: It looks like transaction fees

by gpm 6y ago

Quick back of the napkin math suggests that the kwh numbers are the right order of magnitude (surprisingly to me)... work below: It looks like transaction fees are ~8 dollars right now [1], lets call it 10 dollars for easy math. The cheapest state/kwh is Louisiana [2], at 7 cents per kwh, let's assume that the cost of mining bitcoin is just electricity, and that you can get it at 10c/kwh for easy math. You now have 100kwh/transaction... that's 1/6th of what's reported on that site... but the same order of magnitude and the above analysis ignores block rewards... [1] https://privacypros.io/tools/bitcoin-fee-estimator/ https://privacypros.io/tools/bitcoin-fee-estimator/ [2] https://www.energybot.com/electricity-rates-by-state.html https://www.energybot.com/electricity-rates-by-state.html

tromp 6y ago
Your analysis would be appropriate if the block subsidy has becomes insignificant relative to the tx fees. Right now the former is still an order of magnitude larger. That should change within 1-2 decades...
- gpm 6y ago
  Yep, so... a quick glance at this site [1] suggests that revenue from transaction fees is slightly over 1/10^th the total revenue from mining (avg of last 7 days). That would move my estimate of 100kwh to 1000kwh... still the same order of magnitude as the original claims. [1] https://www.blockchain.com/charts/miners-revenue https://www.blockchain.com/charts/miners-revenue
jjk166 6y ago
A current ASIC bitcoin miner will do 90 Terahashes per second (1 Terahash = 1 trillion hashes) while consuming 3420 Watts which is equivalent to 38 Watts per Terahash (38 W/TH). Average power consumption will be higher, though those with big dedicated rigs probably make up the bulk of the network's processing power. The entire bitcoin mining network which processes all transactions does 120 Exahashes (120,000,000 terahashes) per second. Were all mining done on comparable asics this would be 4.56 GW to run the whole network, which in turn means electricity consumption would be 4.56 million kwh per hour. At the time of this writing bitcoin is averaging 14,814 transactions per hour, meaning the average electricity consumption per transaction is 308 kwh. I could easily see the average hash efficiency for the whole network being half of what a 2020 dedicated mining rig can do. Do note that this is transaction processing on bitcoin proper, which is artificially limited to processing less than 7 transactions per second. There are lots of things that we would think of as transactions that don't have to go into this number. For example if you have a trusted marketplace, you can have all the transactions which take place within the marketplace in a given time period lumped together as a single transaction, and thus you only need to do a "real" transaction when you deposit or withdraw money from that market. This is the concept behind many cryptocurrencies meant to "speed up" bitcoin. So really it's not so much a 5 hour flight every time you use a credit card, but a 5 hour flight every time you get a new credit card - still inefficient, but far less extreme.

by gpm 6y ago

tromp 6y ago

Your analysis would be appropriate if the block subsidy has becomes insignificant relative to the tx fees. Right now the former is still an order of magnitude larger. That should change within 1-2 decades...

gpm 6y ago
Yep, so... a quick glance at this site [1] suggests that revenue from transaction fees is slightly over 1/10^th the total revenue from mining (avg of last 7 days). That would move my estimate of 100kwh to 1000kwh... still the same order of magnitude as the original claims. [1] https://www.blockchain.com/charts/miners-revenue https://www.blockchain.com/charts/miners-revenue

jjk166 6y ago

A current ASIC bitcoin miner will do 90 Terahashes per second (1 Terahash = 1 trillion hashes) while consuming 3420 Watts which is equivalent to 38 Watts per Terahash (38 W/TH). Average power consumption will be higher, though those with big dedicated rigs probably make up the bulk of the network's processing power. The entire bitcoin mining network which processes all transactions does 120 Exahashes (120,000,000 terahashes) per second. Were all mining done on comparable asics this would be 4.56 GW to run the whole network, which in turn means electricity consumption would be 4.56 million kwh per hour. At the time of this writing bitcoin is averaging 14,814 transactions per hour, meaning the average electricity consumption per transaction is 308 kwh. I could easily see the average hash efficiency for the whole network being half of what a 2020 dedicated mining rig can do. Do note that this is transaction processing on bitcoin proper, which is artificially limited to processing less than 7 transactions per second. There are lots of things that we would think of as transactions that don't have to go into this number. For example if you have a trusted marketplace, you can have all the transactions which take place within the marketplace in a given time period lumped together as a single transaction, and thus you only need to do a "real" transaction when you deposit or withdraw money from that market. This is the concept behind many cryptocurrencies meant to "speed up" bitcoin. So really it's not so much a 5 hour flight every time you use a credit card, but a 5 hour flight every time you get a new credit card - still inefficient, but far less extreme.