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Cryptocurrencies are worse for the climate than you think

78 points by SebRollen 4y ago

junofan 4y ago
One bitcoin transaction costs two orders of magnitude less than my monthly power bill, yet the author claims one transaction uses 2.5 household-months worth of electricity. Something seems way off with the numbers.
- jayd16 4y ago
  For a start, miners don't pay your local rates. They find something cheaper.
- danShumway 4y ago
  I'm not an expert on Bitcoin's power usage, however a few things spring to mind. - Electricity costs are not constant everywhere, not everyone burning that power is spending the same amount as you (and in general, home farming Bitcoin using the cost of electricity in your area is probably not profitable, at least for most people reading this). It's almost certainly a mistake to use your local electricity rates as a baseline for how much money mining costs. - Not everyone mining Bitcoin actually pays for their electricity, some of it is stolen. Some mining happens on hacked hardware, sometimes mining rigs tap into electrical sources that they shouldn't have access to. And the really big reason that springs to mind: - You are not paying the full electricity cost for mining Bitcoin in transaction fees, the generation of new coins is offsetting some of that cost. Remember that Bitcoin is a speculative asset first, and a transaction method second. The network, and payout/fee structure for transactions are also constructed in a way that can mess with market forces a bit. There's a lot more going on than just "you want to spend money, pay enough to cover the electricity fees to make that happen."
  - cecilpl2 4y ago
    > You are not paying the full electricity cost for mining Bitcoin in transaction fees, the generation of new coins is offsetting some of that cost. This is the big factor. As the block reward decreases, transaction costs will need to increase dramatically.
    - SilasX 4y ago
      Or the number of miners contracts in response to the reduced rewards.
      - danShumway 4y ago
        If the network was amiable to increasing the number of miner contracts per block, wouldn't they have done it already? Transaction speed and cost is already a regular criticism of the Bitcoin network. It's so much of a criticism that the Bitcoin community made the Lightning Network and started pulling transactions off-chain and pooling them to address that concern. But they didn't collectively decide to increase the number of allowed miner contracts. They literally built a second network rather than change the max block size. And in fact it was not only not accepted, it was a big source of controversy to even try to increase the block size. That was the whole deal with Bitcoin Cash, people were outright hostile to this idea.
        SilasX 4y ago
        >If the network was amiable to increasing the number of miner contracts per block, wouldn't they have done it already? “Contracts” is a verb in that sentence, not a noun, and yes, miners do leave the market as it loses profitability, and no, the network does not have a requirement that there be a minimum number of miners, and there are reasons why they haven't left now but might not leave in the future. You're not using the "why haven't they done it already" heuristic correctly.
        danShumway 4y ago
        Oh, I see what you mean -- you don't mean contracts as in the number of miner's transactions/rewards per block, you mean contracts as in "the miner pool decreases in size." My bad, that was a mistake on my part. Agreed, that's definitely a possibility, and that would improve energy usage. However, it would also make the network more vulnerable to 51% attacks, and if Bitcoin were to have enough value to actually replace a financial market, it would need a lot of miners to secure that value or it likely lose that value. But... quibbles aside, you are completely correct that if mining stops being profitable then fewer people will mine, and that is also the correct answer for how to deal with Bitcoin's energy usage. Bitcoin miners will use as much much energy as it is profitable for them to use, and the only way to make that energy usage go down other than banning crypto would be to decrease the profitability of mining (ie, by keeping transaction fees and payouts low and by reducing other mining rewards) -- and that could be accomplished through either reducing the rewards, moving to another system like PoS that removes the miners entirely, or by Bitcoin's price crashing.
- yunohn 4y ago
  > One bitcoin transaction costs two orders of magnitude less than my monthly power bill How much is your monthly bill? I pay somewhere around 10€.
- ufo 4y ago
  The difference is the mining subsidy. The energy expenditure for a block is related to the total mining reward, which is transaction price + 6.25 newly minted bitcoins.
- kevin_b_er 4y ago
  The article is estimating the cost at 2150 KWh per transaction vs the total bitcoin estimated power usage. So this is trying to average out the total electrical cost including mining into a per-transaction cost.
  - drexlspivey 4y ago
    If they increase the arbitrary block size by x100 this number will become 21.5 KWh and nothing will change but at least these annoying articles will go away.
    - cypress66 4y ago
      That already exists and is called bitcoin cash
- Imnimo 4y ago
  There are generously 2k transactions per block. Block reward is 6.25 bitcoins. A bitcoin costs $30,000 so the block reward is $187,500. Amortizing over 2k transactions, each transaction is worth a smidge under $100, before transaction fees (which as you point out are two orders of magnitude smaller so don't really matter here). $100 is about the average US monthly power bill, and it doesn't seem unreasonable that miners making use of the cheapest energy around the globe would be paying 2.5x less than that.
- sumy23 4y ago
  A miner gets like 6 bit coins for each block they mine. The transaction fees are just icing on the cake for them.
- sophacles 4y ago
  That comparison makes no sense. Your monthly power bill includes taxes, grid connection fees, etc - not just the cost of the power. Depending on where you live, there may also be natural gas bundled with electricity, adding costs that are not relevant to bitcoin. A lot of those fees don't scale with electricity used, but are fixed (driving down the marginal cost, etc). Further, the rates for your home are not the same as rates in other places (odds are that somewhere else has cheaper electricity than you do).
Proven 4y ago
smthg2say624 4y ago
I don't think the method is correct. There is no "energy cost for transaction" in Bitcoin, it's an energy cost per block. And it's a global constant, it doesn't make sense to say that you making 26 transactions a year will be worst for the environment than 1, or 0 for that case.
- SebRollen 4y ago
  You're right that the energy cost is incurred at the block-level, but since each block can hold a certain number of transactions, you can then infer what the effective cost is per transaction. The source for kWh per transaction comes from Digiconomist's bitcoin energy consumption index, and you can find their methodology here: https://digiconomist.net/bitcoin-energy-consumption#assumptions https://digiconomist.net/bitcoin-energy-consumption#assumpti...
  - thebean11 4y ago
    It's just an incorrect attribution. If there are no transactions, blocks will still be mined. If there are more transactions than can fit in a block, no extra blocks will be mined. If the transaction format changes so that more transactions can be included in a block, the energy usage doesn't change. It's just a very obfuscating way to describe what's happening. Not only is it not a useful abstraction, but it actively leads you to wrong conclusions to talk about it in terms of energy use per transaction.
    - SebRollen 4y ago
      I think this commenter put it pretty well, so I'll just link to it: https://news.ycombinator.com/item?id=31596781 https://news.ycombinator.com/item?id=31596781
      - thebean11 4y ago
        All of those things are directly attributable to miles on the car. More miles means more repairs, more frequent oil changes, faster depreciation of your purchase price etc. On the other hand, number of transactions is purely a function of block size and transaction size (which again has no influence on energy usage).
ea550ff70a 4y ago
If we end cryptos today, in the grand scheme of things, we are going to see no real difference proportional to the global energy consumption of everything else as, while enormous quantity wise, consumption is still below 0.5% or so (so really not that big of a deal percentage wise). How did the predictions and articles from a few years ago on how Bitcoin was going to take, by 2020, the global energy share of consumption pan out? Obviously they were wrong, as consumption of everything else grew as fast or faster than it. The drama against cryptos and their energy consumption is unproductive and is imho going to yield no change (in the grand scheme of things), as the field can't really be tamed the same way other industries can due to its decentralized approach of doing things. Instead of wasting time with this approach, we should be pushing for and incentivizing cheap green energy sources, as that is where the real issue comes for every industry. As long as the source is green, which it already is fo a huge chunk of the energy behind cryptos, and as long as it is not messing with the availability for the demand in the grid for other industries/consumers, then who cares how much it consumes?
- nathias 4y ago
  While these environmental critics are trivial, at least they are true for PoW, and have made a significant change. Crypto projects now like to offset their carbon footprint even if they have a very low one to begin with.
- derac 4y ago
  If public concensus is negative on crypto, the market shrinks. You can criticize crypto and support green energy at the same time.
  - ea550ff70a 4y ago
    Other than price of most of them (due mostly to macroeconomics really and unhealthy rapid expansion which is not uncommon to happen each cycle) adoption and use of them in almost every metric is up and increasing.
    - derac 4y ago
throttledagain2 4y ago
thirtyfivecent 4y ago
- boppo1 4y ago
  Bankers are well positioned to profit whether crypto dies or succeeds. Disabuse yourself of any notion that crypto will "defeat the banking system". It is cool technology and might move commerce forward (remains to be seen) but any empowerment of "non bankers/elites" will be limited to those who have had time/education for deep technical literacy. Average people will largely use crypto solutions through intermediaries who will be "new bankers" and pull lots of the same BS we don't like bankers for pulling. See: OpenSea insider trading
  - hi5eyes 4y ago
    bankers/quants already use illegal tactics in crypto, look no further than some the biggest cexs dont really think using the most recent OpenSea situation is the best example, seems like like pr to broaden the definition of securities to
- MrMan 4y ago
  You know it's getting much much hotter right? What is the logical extension of your point? Elites and non elites are threatened by the heat. The fact that climate change is real and here means your statement is false which makes you the propagandist. Luckily for you this site is anonymous.
TheDudeMan 4y ago
Not all cryptocurrencies are proof-of-work, which are the ones that use lots of energy. EDIT: PoS is a dumpster fire. But PoW and PoS are not the only games in town.
- garren 4y ago
  Arguably, only the ones that can really claim to be decentralized. PoS, in its different variations, seems to introduce more obvious centralization in one from or another. I’ve yet to hear a solid argument otherwise.
  - mateuszf 4y ago
    PoS cryptocurrencies are like attaching wheels to horses. Why make alternative finance systems based on the same fact that the wealthiest entities control the policy of the network? Exactly like in the current system with central banks and governments.
  - TheDudeMan 4y ago
    That is not arguable. Chia's Proof of Space and Time uses Nakamoto consensus (like Bitcoin) and is even more decentralized.
yieldcrv 4y ago
here we go again, they use a faulty understanding and a faulty source > Each Bitcoin transaction consumes around 2,150 kWh as of the time of this writing. This is wrong because Proof of Work blockchains use the same amount of energy whether any individual makes a transaction or not. Doesn't anyone else find it ironic that actually understanding how that blockchain works could bolster that particular anti-energy use reaction? Ah! but the same people don't want to spend any of their own energy understanding how blockchains work because they've already made up their mind that its not worth doing that!
- masswerk 4y ago
  The article is really about the environmental cost of the network. Breaking it down to transactions is just a basic tool to promote understanding and quite a common one (like in cost of ownership ratios.) Mind that the whole purpose of the network is still to enable and maintain these transactions. The article eventually transitions from there to the total cost of the network in TWh and the number of those participating in this network by individual transactions.
  - yieldcrv 4y ago
    Its next section does slightly better, after doubling and tripling down on the household consumption framework. The source of energy is way more important, bitcoin's source of energy is pretty good compared to any industry, and it can be better. Individual vigilance should be placed on ensuring that the overall source of energy for bitcoin gets better. because some of those major sources are reducing pollution and emissions. more mining can happen at more of those places. while other energy sources can be avoided.
    - WorldMaker 4y ago
      Except that energy usage is mostly zero-sum: if Bitcoin is using all renewable energy sources [0], then all other uses of energy must use dirtier sources if those sources are already heavily utilized by bitcoin. Homes have to use more coal if Bitcoin is using all the wind/hydro. The pool of available energy resources is currently quite finite and while "the grid" abstracts away most of the sources from your view as an electricity user, it doesn't eliminate the fact that there are some very big zero-sum tradeoffs between the sources and "the grid" will adjust to increased demand with increased supply of increasingly dirty sources to meet that demand. [0] Which is a presumption that is extremely arguable given how much we've seen shutdowns/restarts of coal-powered plants in for instance China and Kazakhstan impact the Bitcoin mining pools over time.
askmike 4y ago
What article is claiming is based on a misunderstanding of how Bitcoin works, this really is an odd way of thinking about it. If half of all people stop sending bitcoin around, the amount of electricity used doesn't go down by 50%. So you sending or not sending bitcoin doesn't impact the electricity spend by miners at all. Miners mine to secure the network, there is not a certain amount of electricity needed per transaction.
- steeve 4y ago
  True, but the network serves a purpose. Without transactions, would there be a network to begin with? Therefore, you can model a per transaction cost within certain bounds.
- paulgb 4y ago
  It's not so odd. Those people are willing to transact in Bitcoin because it's sufficiently secure against a 51% attack. So in a sense they're consuming the benefit of the overall network hashrate, even though the cost they pay is heavily subsidized.
- speedgoose 4y ago
  If all people stop using bitcoin, the amount of electricity goes to zero.
- rspeele 4y ago
  But, the only purpose of mining -- the whole purpose of the blockchain -- is to facilitate transacting. So if the network can only do X transactions per day, and it costs $Y to run the network, it seems fair to use a "cost per transaction" to describe that inefficiency. Kind of like how I could represent the total cost of ownership of a car (purchase price, oil changes, tire changes, big repairs, fuel) in terms of $ per mile, even though out of all those costs, only fuel is directly consumed by driving a single mile.
  - lowkey 4y ago
    It is incorrect to assume that the only, or even the most important, purpose of bitcoin is for transactions. Bitcoin users primarily hold Bitcoin as a store of value or speculative savings technology, typically held over long periods of time (years) with an expectation of price appreciation at the expense of short-term volatility. It is not, as many on HN have correctly pointed out, a viable transactional currency for most use cases due to price volatility, taxation related friction, limited real-world adoption for payments or transaction costs. The only compelling transactional use cases I know of are censorship resistant payments (e.g, Wikileaks) or high value international funds transfers outside G8 countries where wires are slow and risky. Most Bitcoin is held by savers or speculators over long periods and transactions are infrequent. Therefore the primary purpose of Bitcoin mining is securing the network from bad actors. Bitcoin is a secure vault on the internet. Just because people put money in and take money out of a vault doesn’t mean the purpose of a vault is transactions. It is security against 51% attacks. Therefore, the appropriate measure is not cost per transaction. It is cost per total value secured.
yieldcrv 4y ago
"omg bitcoin's 0.5% of global energy use (while being a smaller footprint than all these other industries) is the same amount of energy as countries!" which means everything that uses 0.5% or more of global power uses the same amount of energy as many countries seems like an irrelevant metric, and it is. this isn't about "pointing out worse things to justify bitcoin's energy use", its about this just being a bad metric to begin with.
rvz 4y ago
The title should be: 'Proof-of-work cryptocurrencies are worse for the climate than you think'. The author knows it as described in the footnote [0], but why not put in some clickbait anyway and hide the fact that the study they linked to are related to all PoW cryptocurrencies [1]. Not all cryptocurrencies are PoW like Bitcoin. XRP, Cardano, Solana, Polkadot, Stellar and Algorand to name a few with over $1B market cap are not 'burning the planet'. Maybe by that logic, every single car (including electric ones) is worse for the climate than you think. Is that a safe generalization? Does that mean you should stop driving your car, truck, etc? No. Greener alternatives to petrol and diesel actually exist for such vehicles. The same is true for some 'cryptocurrencies' (coins) that have over a billion market cap which are greener alternatives to PoW cryptocurrencies like Bitcoin. But nice try with the clickbait headline and sweeping generalization to all cryptocurrencies though. How comes this petition, led by many critics also know this difference? [2] They tried to ban mining in the UK and it appears to have failed to get attention and enough signatures for a discussion in parliament in the UK. [0] https://rollen.io/blog/crypto-climate/#footnote:1 https://rollen.io/blog/crypto-climate/#footnote:1 [1] https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7402366/table/tbl1/?report=objectonly https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7402366/table/t... [2] https://petition.parliament.uk/petitions/601629 https://petition.parliament.uk/petitions/601629
newaccount2021 4y ago
maebert 4y ago
Yes , proof-of-work crypto is a terrible idea for the environment. But also, this article gets so many things wrong I don't even know where to start. For one, it confuses a "transaction" with "mining a block". A single block can facilitate around 500 transactions on the bitcoin chain, so if an end user wants to "send a bitcoin" as the article states, divide that monstrous energy usage by 500, and suddenly the graphs are not quite as emotionally charged anymore. The other part is that not all energy is created equal. A third of the time, the world has a surplus of energy that can't be efficiently used or stored (daylight for solar, wet season for hydro...) — miners have taken advantage of that years ago and most mining is done when and where energy is cheap because it's a surplus. Doesn't mean that this nullifies the impact, but any comparisons of bitcoin energy use to that of a physically constrained country are incredibly misleading.
- SebRollen 4y ago
  No, the calculation is done per transaction, not per block. You can calculate the per-block consumption pretty easily based on the stat that there are about 150[1] blocks mined daily and the total TWh used per year for the network is 200[2]. 200 TWh per year / (365 days * 150 blocks) = 3.6MWh per block. The amount of transactions per block is around 2,000[3], so if you divide that number by 2,000 you get around 1,800 kWh per transaction [1] https://stats.buybitcoinworldwide.com/blocks-daily/ https://stats.buybitcoinworldwide.com/blocks-daily/ [2] https://digiconomist.net/bitcoin-energy-consumption/ https://digiconomist.net/bitcoin-energy-consumption/ [3] https://ycharts.com/indicators/bitcoin_average_transactions_per_block https://ycharts.com/indicators/bitcoin_average_transactions_...
picsao 4y ago
frank_bb 4y ago

78 points by SebRollen 4y ago

One bitcoin transaction costs two orders of magnitude less than my monthly power bill, yet the author claims one transaction uses 2.5 household-months worth of electricity. Something seems way off with the numbers.

jayd16 4y ago
For a start, miners don't pay your local rates. They find something cheaper.
danShumway 4y ago
I'm not an expert on Bitcoin's power usage, however a few things spring to mind. - Electricity costs are not constant everywhere, not everyone burning that power is spending the same amount as you (and in general, home farming Bitcoin using the cost of electricity in your area is probably not profitable, at least for most people reading this). It's almost certainly a mistake to use your local electricity rates as a baseline for how much money mining costs. - Not everyone mining Bitcoin actually pays for their electricity, some of it is stolen. Some mining happens on hacked hardware, sometimes mining rigs tap into electrical sources that they shouldn't have access to. And the really big reason that springs to mind: - You are not paying the full electricity cost for mining Bitcoin in transaction fees, the generation of new coins is offsetting some of that cost. Remember that Bitcoin is a speculative asset first, and a transaction method second. The network, and payout/fee structure for transactions are also constructed in a way that can mess with market forces a bit. There's a lot more going on than just "you want to spend money, pay enough to cover the electricity fees to make that happen."
- cecilpl2 4y ago
  > You are not paying the full electricity cost for mining Bitcoin in transaction fees, the generation of new coins is offsetting some of that cost. This is the big factor. As the block reward decreases, transaction costs will need to increase dramatically.
  - SilasX 4y ago
    Or the number of miners contracts in response to the reduced rewards.
    - danShumway 4y ago
      If the network was amiable to increasing the number of miner contracts per block, wouldn't they have done it already? Transaction speed and cost is already a regular criticism of the Bitcoin network. It's so much of a criticism that the Bitcoin community made the Lightning Network and started pulling transactions off-chain and pooling them to address that concern. But they didn't collectively decide to increase the number of allowed miner contracts. They literally built a second network rather than change the max block size. And in fact it was not only not accepted, it was a big source of controversy to even try to increase the block size. That was the whole deal with Bitcoin Cash, people were outright hostile to this idea.
      - SilasX 4y ago
        >If the network was amiable to increasing the number of miner contracts per block, wouldn't they have done it already? “Contracts” is a verb in that sentence, not a noun, and yes, miners do leave the market as it loses profitability, and no, the network does not have a requirement that there be a minimum number of miners, and there are reasons why they haven't left now but might not leave in the future. You're not using the "why haven't they done it already" heuristic correctly.
        danShumway 4y ago
        Oh, I see what you mean -- you don't mean contracts as in the number of miner's transactions/rewards per block, you mean contracts as in "the miner pool decreases in size." My bad, that was a mistake on my part. Agreed, that's definitely a possibility, and that would improve energy usage. However, it would also make the network more vulnerable to 51% attacks, and if Bitcoin were to have enough value to actually replace a financial market, it would need a lot of miners to secure that value or it likely lose that value. But... quibbles aside, you are completely correct that if mining stops being profitable then fewer people will mine, and that is also the correct answer for how to deal with Bitcoin's energy usage. Bitcoin miners will use as much much energy as it is profitable for them to use, and the only way to make that energy usage go down other than banning crypto would be to decrease the profitability of mining (ie, by keeping transaction fees and payouts low and by reducing other mining rewards) -- and that could be accomplished through either reducing the rewards, moving to another system like PoS that removes the miners entirely, or by Bitcoin's price crashing.
yunohn 4y ago
> One bitcoin transaction costs two orders of magnitude less than my monthly power bill How much is your monthly bill? I pay somewhere around 10€.
ufo 4y ago
The difference is the mining subsidy. The energy expenditure for a block is related to the total mining reward, which is transaction price + 6.25 newly minted bitcoins.
kevin_b_er 4y ago
The article is estimating the cost at 2150 KWh per transaction vs the total bitcoin estimated power usage. So this is trying to average out the total electrical cost including mining into a per-transaction cost.
- drexlspivey 4y ago
  If they increase the arbitrary block size by x100 this number will become 21.5 KWh and nothing will change but at least these annoying articles will go away.
  - cypress66 4y ago
    That already exists and is called bitcoin cash
Imnimo 4y ago
There are generously 2k transactions per block. Block reward is 6.25 bitcoins. A bitcoin costs $30,000 so the block reward is $187,500. Amortizing over 2k transactions, each transaction is worth a smidge under $100, before transaction fees (which as you point out are two orders of magnitude smaller so don't really matter here). $100 is about the average US monthly power bill, and it doesn't seem unreasonable that miners making use of the cheapest energy around the globe would be paying 2.5x less than that.
sumy23 4y ago
A miner gets like 6 bit coins for each block they mine. The transaction fees are just icing on the cake for them.
sophacles 4y ago
That comparison makes no sense. Your monthly power bill includes taxes, grid connection fees, etc - not just the cost of the power. Depending on where you live, there may also be natural gas bundled with electricity, adding costs that are not relevant to bitcoin. A lot of those fees don't scale with electricity used, but are fixed (driving down the marginal cost, etc). Further, the rates for your home are not the same as rates in other places (odds are that somewhere else has cheaper electricity than you do).

Proven 4y ago

smthg2say624 4y ago

I don't think the method is correct. There is no "energy cost for transaction" in Bitcoin, it's an energy cost per block. And it's a global constant, it doesn't make sense to say that you making 26 transactions a year will be worst for the environment than 1, or 0 for that case.

SebRollen 4y ago
You're right that the energy cost is incurred at the block-level, but since each block can hold a certain number of transactions, you can then infer what the effective cost is per transaction. The source for kWh per transaction comes from Digiconomist's bitcoin energy consumption index, and you can find their methodology here: https://digiconomist.net/bitcoin-energy-consumption#assumptions https://digiconomist.net/bitcoin-energy-consumption#assumpti...
- thebean11 4y ago
  It's just an incorrect attribution. If there are no transactions, blocks will still be mined. If there are more transactions than can fit in a block, no extra blocks will be mined. If the transaction format changes so that more transactions can be included in a block, the energy usage doesn't change. It's just a very obfuscating way to describe what's happening. Not only is it not a useful abstraction, but it actively leads you to wrong conclusions to talk about it in terms of energy use per transaction.
  - SebRollen 4y ago
    I think this commenter put it pretty well, so I'll just link to it: https://news.ycombinator.com/item?id=31596781 https://news.ycombinator.com/item?id=31596781
    - thebean11 4y ago
      All of those things are directly attributable to miles on the car. More miles means more repairs, more frequent oil changes, faster depreciation of your purchase price etc. On the other hand, number of transactions is purely a function of block size and transaction size (which again has no influence on energy usage).

ea550ff70a 4y ago

If we end cryptos today, in the grand scheme of things, we are going to see no real difference proportional to the global energy consumption of everything else as, while enormous quantity wise, consumption is still below 0.5% or so (so really not that big of a deal percentage wise). How did the predictions and articles from a few years ago on how Bitcoin was going to take, by 2020, the global energy share of consumption pan out? Obviously they were wrong, as consumption of everything else grew as fast or faster than it. The drama against cryptos and their energy consumption is unproductive and is imho going to yield no change (in the grand scheme of things), as the field can't really be tamed the same way other industries can due to its decentralized approach of doing things. Instead of wasting time with this approach, we should be pushing for and incentivizing cheap green energy sources, as that is where the real issue comes for every industry. As long as the source is green, which it already is fo a huge chunk of the energy behind cryptos, and as long as it is not messing with the availability for the demand in the grid for other industries/consumers, then who cares how much it consumes?

nathias 4y ago
While these environmental critics are trivial, at least they are true for PoW, and have made a significant change. Crypto projects now like to offset their carbon footprint even if they have a very low one to begin with.
derac 4y ago
If public concensus is negative on crypto, the market shrinks. You can criticize crypto and support green energy at the same time.
- ea550ff70a 4y ago
  Other than price of most of them (due mostly to macroeconomics really and unhealthy rapid expansion which is not uncommon to happen each cycle) adoption and use of them in almost every metric is up and increasing.
  - derac 4y ago

throttledagain2 4y ago

thirtyfivecent 4y ago

boppo1 4y ago
Bankers are well positioned to profit whether crypto dies or succeeds. Disabuse yourself of any notion that crypto will "defeat the banking system". It is cool technology and might move commerce forward (remains to be seen) but any empowerment of "non bankers/elites" will be limited to those who have had time/education for deep technical literacy. Average people will largely use crypto solutions through intermediaries who will be "new bankers" and pull lots of the same BS we don't like bankers for pulling. See: OpenSea insider trading
- hi5eyes 4y ago
  bankers/quants already use illegal tactics in crypto, look no further than some the biggest cexs dont really think using the most recent OpenSea situation is the best example, seems like like pr to broaden the definition of securities to
MrMan 4y ago
You know it's getting much much hotter right? What is the logical extension of your point? Elites and non elites are threatened by the heat. The fact that climate change is real and here means your statement is false which makes you the propagandist. Luckily for you this site is anonymous.

TheDudeMan 4y ago

Not all cryptocurrencies are proof-of-work, which are the ones that use lots of energy. EDIT: PoS is a dumpster fire. But PoW and PoS are not the only games in town.

garren 4y ago
Arguably, only the ones that can really claim to be decentralized. PoS, in its different variations, seems to introduce more obvious centralization in one from or another. I’ve yet to hear a solid argument otherwise.
- mateuszf 4y ago
  PoS cryptocurrencies are like attaching wheels to horses. Why make alternative finance systems based on the same fact that the wealthiest entities control the policy of the network? Exactly like in the current system with central banks and governments.
- TheDudeMan 4y ago
  That is not arguable. Chia's Proof of Space and Time uses Nakamoto consensus (like Bitcoin) and is even more decentralized.

yieldcrv 4y ago

here we go again, they use a faulty understanding and a faulty source > Each Bitcoin transaction consumes around 2,150 kWh as of the time of this writing. This is wrong because Proof of Work blockchains use the same amount of energy whether any individual makes a transaction or not. Doesn't anyone else find it ironic that actually understanding how that blockchain works could bolster that particular anti-energy use reaction? Ah! but the same people don't want to spend any of their own energy understanding how blockchains work because they've already made up their mind that its not worth doing that!

masswerk 4y ago
The article is really about the environmental cost of the network. Breaking it down to transactions is just a basic tool to promote understanding and quite a common one (like in cost of ownership ratios.) Mind that the whole purpose of the network is still to enable and maintain these transactions. The article eventually transitions from there to the total cost of the network in TWh and the number of those participating in this network by individual transactions.
- yieldcrv 4y ago
  Its next section does slightly better, after doubling and tripling down on the household consumption framework. The source of energy is way more important, bitcoin's source of energy is pretty good compared to any industry, and it can be better. Individual vigilance should be placed on ensuring that the overall source of energy for bitcoin gets better. because some of those major sources are reducing pollution and emissions. more mining can happen at more of those places. while other energy sources can be avoided.
  - WorldMaker 4y ago
    Except that energy usage is mostly zero-sum: if Bitcoin is using all renewable energy sources [0], then all other uses of energy must use dirtier sources if those sources are already heavily utilized by bitcoin. Homes have to use more coal if Bitcoin is using all the wind/hydro. The pool of available energy resources is currently quite finite and while "the grid" abstracts away most of the sources from your view as an electricity user, it doesn't eliminate the fact that there are some very big zero-sum tradeoffs between the sources and "the grid" will adjust to increased demand with increased supply of increasingly dirty sources to meet that demand. [0] Which is a presumption that is extremely arguable given how much we've seen shutdowns/restarts of coal-powered plants in for instance China and Kazakhstan impact the Bitcoin mining pools over time.

askmike 4y ago

What article is claiming is based on a misunderstanding of how Bitcoin works, this really is an odd way of thinking about it. If half of all people stop sending bitcoin around, the amount of electricity used doesn't go down by 50%. So you sending or not sending bitcoin doesn't impact the electricity spend by miners at all. Miners mine to secure the network, there is not a certain amount of electricity needed per transaction.

steeve 4y ago
True, but the network serves a purpose. Without transactions, would there be a network to begin with? Therefore, you can model a per transaction cost within certain bounds.
paulgb 4y ago
It's not so odd. Those people are willing to transact in Bitcoin because it's sufficiently secure against a 51% attack. So in a sense they're consuming the benefit of the overall network hashrate, even though the cost they pay is heavily subsidized.
speedgoose 4y ago
If all people stop using bitcoin, the amount of electricity goes to zero.
rspeele 4y ago
But, the only purpose of mining -- the whole purpose of the blockchain -- is to facilitate transacting. So if the network can only do X transactions per day, and it costs $Y to run the network, it seems fair to use a "cost per transaction" to describe that inefficiency. Kind of like how I could represent the total cost of ownership of a car (purchase price, oil changes, tire changes, big repairs, fuel) in terms of $ per mile, even though out of all those costs, only fuel is directly consumed by driving a single mile.
- lowkey 4y ago
  It is incorrect to assume that the only, or even the most important, purpose of bitcoin is for transactions. Bitcoin users primarily hold Bitcoin as a store of value or speculative savings technology, typically held over long periods of time (years) with an expectation of price appreciation at the expense of short-term volatility. It is not, as many on HN have correctly pointed out, a viable transactional currency for most use cases due to price volatility, taxation related friction, limited real-world adoption for payments or transaction costs. The only compelling transactional use cases I know of are censorship resistant payments (e.g, Wikileaks) or high value international funds transfers outside G8 countries where wires are slow and risky. Most Bitcoin is held by savers or speculators over long periods and transactions are infrequent. Therefore the primary purpose of Bitcoin mining is securing the network from bad actors. Bitcoin is a secure vault on the internet. Just because people put money in and take money out of a vault doesn’t mean the purpose of a vault is transactions. It is security against 51% attacks. Therefore, the appropriate measure is not cost per transaction. It is cost per total value secured.

yieldcrv 4y ago

"omg bitcoin's 0.5% of global energy use (while being a smaller footprint than all these other industries) is the same amount of energy as countries!" which means everything that uses 0.5% or more of global power uses the same amount of energy as many countries seems like an irrelevant metric, and it is. this isn't about "pointing out worse things to justify bitcoin's energy use", its about this just being a bad metric to begin with.

rvz 4y ago

The title should be: 'Proof-of-work cryptocurrencies are worse for the climate than you think'. The author knows it as described in the footnote [0], but why not put in some clickbait anyway and hide the fact that the study they linked to are related to all PoW cryptocurrencies [1]. Not all cryptocurrencies are PoW like Bitcoin. XRP, Cardano, Solana, Polkadot, Stellar and Algorand to name a few with over $1B market cap are not 'burning the planet'. Maybe by that logic, every single car (including electric ones) is worse for the climate than you think. Is that a safe generalization? Does that mean you should stop driving your car, truck, etc? No. Greener alternatives to petrol and diesel actually exist for such vehicles. The same is true for some 'cryptocurrencies' (coins) that have over a billion market cap which are greener alternatives to PoW cryptocurrencies like Bitcoin. But nice try with the clickbait headline and sweeping generalization to all cryptocurrencies though. How comes this petition, led by many critics also know this difference? [2] They tried to ban mining in the UK and it appears to have failed to get attention and enough signatures for a discussion in parliament in the UK. [0] https://rollen.io/blog/crypto-climate/#footnote:1 https://rollen.io/blog/crypto-climate/#footnote:1 [1] https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7402366/table/tbl1/?report=objectonly https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7402366/table/t... [2] https://petition.parliament.uk/petitions/601629 https://petition.parliament.uk/petitions/601629

newaccount2021 4y ago

maebert 4y ago

Yes , proof-of-work crypto is a terrible idea for the environment. But also, this article gets so many things wrong I don't even know where to start. For one, it confuses a "transaction" with "mining a block". A single block can facilitate around 500 transactions on the bitcoin chain, so if an end user wants to "send a bitcoin" as the article states, divide that monstrous energy usage by 500, and suddenly the graphs are not quite as emotionally charged anymore. The other part is that not all energy is created equal. A third of the time, the world has a surplus of energy that can't be efficiently used or stored (daylight for solar, wet season for hydro...) — miners have taken advantage of that years ago and most mining is done when and where energy is cheap because it's a surplus. Doesn't mean that this nullifies the impact, but any comparisons of bitcoin energy use to that of a physically constrained country are incredibly misleading.

SebRollen 4y ago
No, the calculation is done per transaction, not per block. You can calculate the per-block consumption pretty easily based on the stat that there are about 150[1] blocks mined daily and the total TWh used per year for the network is 200[2]. 200 TWh per year / (365 days * 150 blocks) = 3.6MWh per block. The amount of transactions per block is around 2,000[3], so if you divide that number by 2,000 you get around 1,800 kWh per transaction [1] https://stats.buybitcoinworldwide.com/blocks-daily/ https://stats.buybitcoinworldwide.com/blocks-daily/ [2] https://digiconomist.net/bitcoin-energy-consumption/ https://digiconomist.net/bitcoin-energy-consumption/ [3] https://ycharts.com/indicators/bitcoin_average_transactions_per_block https://ycharts.com/indicators/bitcoin_average_transactions_...

picsao 4y ago

frank_bb 4y ago