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I'm not a crypto proponent per se, but I do feel the need to be reasonable about it, and this reads like pure emotional anti-cryptocurrency sentiment. (edit: w

I'm not a crypto proponent per se, but I do feel the need to be reasonable about it, and this reads like pure emotional anti-cryptocurrency sentiment. (edit: while I still can, I'm going to jump in and repeat that I'm criticizing this as a bad article which isn't saying anything very meaningful on its own. Thanks everyone for doing the author's work for them and gathering more data. I won't be upset if it's proven that crypto is intrinsically bad for everything I love - except insofar as I believe it can't be stopped.) 1. There is no comparison made to the energy consumption of the traditional banking industry, which I am sure is not a particularly energy-efficient industry. 2. The title of the article is itself editorializing the content of the article and is speculative according to their own words. From TFA: "[The EIA] released a study suggesting that cryptocurrency mining represents up to 2.3% of U.S. power demand." It could be less, much less, or much less, although I haven't read the actual report yet (I'm criticizing this article only), because "suggesting" could be doing a lot of heavy lifting 3. "Just 137" isn't meaningful AFAIK. Who cares if it's 100 or 10 or 10,000 miners? The point is the amount of crypto being mined. (The number of miners will always be in flux by design anyway.) And the answer to that, from TFA: "The EIA found that the global share of Bitcoin mining that takes place in the U.S. grew from 3.4% in 2020 to a whopping 37.8% in 2022." So roughly ~2% of US power is generating over 1/3 of the world's Bitcoin. This is only obviously bad if you believe Bitcoin is a total waste of energy, which I don't, but I understand that some do. 4. Energy consumption is frankly not a phenomenon I give two shits about, as an environmentalist. Fossil fuel consumption is. From TFA: "We intend to ... quantify the sources of electricity used to meet cryptocurrency mining demand." Meaning this has not been done, and publishing scary warnings is premature. If Bitcoin mining ends up using a higher proportion of renewable energy than, say, traditional banking, it could be seen as a net good for crypto use to rise.

mjburgess 3y ago
The "security" of btc cryptocurrency is proportional to how much energy it wastes; that's radically different than the banking system. The more billions it costs to run bitcoin, the more it costs to 51% attack it. If you can outwaste energy, you can hijack the system. It would be useful it some state, eg., russia or china, would just cut off networks and forge bitcoin network traffic -- and hence bring the whole thing down. Or, do a 51% attack by controlling 51% of the hashing power. The whole thing is a joke, one only tolerated by states because it's supports joke levels of economic transactions. Were any % of an economy to run on this, states would just seal the network in their borders and end the whole charade.
- snapcaster 3y ago
  How would they seal the network in their borders? Why would that bring the whole thing down? Countries that shut down internet don't seem to bring that whole thing down in any sense
  - lovich 3y ago
    https://xkcd.com/538/ https://xkcd.com/538/ Countries have this neat tool called violence that tends to override all security whenever humans are a linchpin
    - hk__2 3y ago
      > Countries have this neat tool called violence that tends to override all security whenever humans are a linchpin That doesn’t work with distributed systems. No single country is able to shut the whole Internet down, for example.
      - manquer 3y ago
        They don’t need to shutdown for everyone , they need to shutdown only for their country . Countries do this all the time , just yesterday we were talking about internet shutdown during elections and exams , then there are restricted countries like say North Korea.
      - ben_w 3y ago
        0) yes they do, in extremis half a dozen HAEMP would basically take out the whole internet (b) "seal the network in their borders" is much easier than that, lots of networks basically act like that already due to either voluntary compliance with local laws, or due to direct government interference with the networks iii. the miners aren't really all that distributed, they group together for the same reason everyone else groups together instead of being free-range anarchists [δ] all you need to do to shut down a currency within a country is arrest people using it, which is very easy and has a long history
      - lovich 3y ago
burnished 3y ago
Looks like it has a bigger share than early 2000s US aluminum processing (a notoriously electricity intensive process), which was using 1.5% https://www.aceee.org/files/proceedings/2003/data/papers/SS03_Panel1_Paper02.pdf https://www.aceee.org/files/proceedings/2003/data/papers/SS0...
- latchkey 3y ago
  Coinmint operates in an old Alcoa plant in upstate NY near Canada. It runs entirely off a dam that was built to power smelting. Power that would otherwise be going to waste (the location is too remote and too expensive to transmit elsewhere). By using the power, it actually helps keep the dam running. https://www.coinmint.one/ https://www.coinmint.one/ Update: if you're going to downvote me, see below before you do so. I have been there, I have seen it, I have talked to people who worked at the plant and the dam.
  - manquer 3y ago
    > too expensive to transmit elsewhere Citation needed . It is rarely if ever too expensive to transmit electricity anywhere . We have offshore wind solar farms in remote places , there is even cross continent lines between Africa and Spain . I am deeply skeptical it is too expensive for upstate NY to transmit power when there is probably 50 million people living in metro areas within say a 750 mile radius . Every other dam is remote, every coal plant is remote they are all perfectly able to transmit to urban and industrial centers
    - latchkey 3y ago
      Look on a map. There is nothing (in the US) that is close to there that would consume the ~500MW of power the dam produces and sends to the plant. The plant was shut down and nobody made an effort to direct the power elsewhere. Transmission is insanely expensive at scale. I've seen their power bills and I talked to their head electrician who worked at the plant when it was operational. That's the best citation I can give you, sorry.
misnome 3y ago
> 1. There is no comparison made to the energy consumption of the traditional banking industry, which I am sure is not a particularly energy-efficient industry. Despite declaring yourself not one, this (and every other one of your points) comes up _every single time_ crypto proponents are trying to seed FUD in any reporting about the energy usage of crypto. This is especially laughable when you then say > ~2% of US power is generating over 1/3 of the world's Bitcoin. It's good to know that it takes 2% of the US power grid to power 2.3 transactions per second. By your own argument - unless the traditional banking industry tops out at 100% of US power usage for 115 transactions per second - it is definitely not worse than bitcoin.
- digging 3y ago
  > Despite declaring yourself not one, this (and every other one of your points) comes up _every single time_ crypto proponents are trying to seed FUD in any reporting about the energy usage of crypto You have it backward, it comes up when reporting tries to seed FUD about crypto energy usage. Every point I made is that this article isn't actually saying anything obviously scary, it's just saying some facts in a scary voice. > By your own argument - unless the traditional banking industry tops out at 100% of US power usage for 115 transactions per second - it is definitely not worse than bitcoin. That's not my argument. They do different things. Despite its name, most cryptocurrency isn't really used as currency. As you say, it's slow and not very useful for that. I'm just making a comparison because most of the thoughtless FUD discussion assumes that USD is free (in energy terms).
- elevaet 3y ago
  > this comes up _every single time_ crypto proponents are trying to seed FUD And it's worth pointing out that it comes up every single time without a shred evidence, just a hunch that the crypto enthusiast ensures us is correct. I'd love to see some actual numbers on the energy consumption of the banking industry vs. crypto. Or lets be real, let's compare the amount of energy used by the banking sector to provide the same store of value and 3 transactions per second or whatever minor utility BTC provides.
  - digging 3y ago
boc 3y ago
> I'm not a crypto proponent per se Yet you rolled out the standard crypto talking points flawlessly. > Energy consumption is frankly not a phenomenon I give two shits about, as an environmentalist Again, I suspect you aren't an environmentalist either. Please just be straightforward with your motivations here.
- digging 3y ago
  Your suspicions are wrong, but you're welcome to add to the debate if you have anything to contribute.
  - boc 3y ago
    I'll be upfront with you: bitcoin is probably the worst "tech" ever mass-adopted. That's my bias. 1. The banking industry is thousands of times more important that crypto for everyday Americans. It's what literally makes our entire economy run. Crypto is used for speculation. What you should be comparing bitcoin against is the energy it takes to list a few ETFs on an exchange, which is essentially the cost of a few hundred servers, aka nothing. Bitcoin is ungodly inefficient and will only become more inefficient. 2. "It could be less, much less, or much less," This is a filler argument. Study says "around" a number, so you're arguing it could be a really broad definition of "around"? Not a serious take. 3. The absolute number matters because it's showing the economic activity is being concentrated in the pockets of just 137 entities. This is NOT a broad-base economic phenomenon that helps employ people in communities around the country, like say running gas stations (another polluting industry). If you're going to use 2% of the nation's electricity, you'd want the benefits spread across at least 2% of the population. Not 0.00002%. 4. Net energy consumption pulls from our current energy grid. Within a grid, if you use more clean electricity in one area, it'll pull more supply from dirtier sources elsewhere. Saying that bitcoin mining helps "green" the grid is a myth because you have to mine it 24/7/365, which means intermittent sources like wind and solar are at a big disadvantage. Battery storage tech is not there yet, thus gas plants and dirtier sources have to kick-in to keep up with 24/7 consumption.
    - digging 3y ago
abeppu 3y ago
Regarding 1, I haven't seen comparisons to the overall energy consumption of the banking sector, but a lot of people have talked about the per-transaction energy of bitcoin vs other kinds of transactions, and the ratio is pretty crazy. I don't think banking is "particularly energy-efficient", but there's not a lot of reason for it to be especially energy intensive. The information surrounding accounts/transactions/portfolios etc is all pretty concise. https://www.statista.com/statistics/881541/bitcoin-energy-consumption-transaction-comparison-visa/ https://www.statista.com/statistics/881541/bitcoin-energy-co...
Devasta 3y ago
> Energy consumption is frankly not a phenomenon I give two shits about, as an environmentalist. Fossil fuel consumption is. If an org has a big polluting coal plant powering a bunch of crypto miners and with a wave of a magic wand I give them an equivalent amount of clean renewable energy, they wouldn't turn off the coal plant, rather they would just double the number of hashes they are pumping out. Proof of work is designed to be as wasteful as possible, it will never ever be efficient or environmentally friendly.
tootie 3y ago
The difference is that crypto mining is a purely contrived exercise. BTC could just as easily be allocated based on how many trees you plant. It's arbitrary.
acdha 3y ago
> There is no comparison made to the energy consumption of the traditional banking industry, which I am sure is not a particularly energy-efficient industry. This is your first mistake: the traditional banking system does not have a security model predicated on the ability to waste power. Bitcoin does, and it’s dynamic so there’s no way to waste less power which isn’t explicitly ceding control. The second error is treat the two as comparable without recognizing that one of them is used daily by millions of people making billions of transactions, and the other has almost no real world adoption. That matters in two ways because it’s not just that bitcoin uses more power to do so much less but also that the real financial system has higher power draw for work in addition to processing transactions. For example, Visa can do on the order of tens of thousands of transactions per second versus Bitcoin’s 7 but if you are looking at how much power they use, the figures will include running a ton of anti-fraud and other support systems which Bitcoin is missing.
- digging 3y ago
  I do admit that the comparison is not a strong one. It wasn't intended to be, honestly, it was just an easy example. My point was more that the data presented in the article aren't very useful on their own. Again, if you think all cryptocurrency has 0 value, then all usage is obviously bad. But the reality is that it has some value, and much of that value is in the form of scams (most types of coins, by number, are scams), and much of the value is just speculative investment, but it is a real thing that people spend real money on. Focusing on miners makes it seem like all the value of crypto comes directly from energy - but nobody would spend energy mining it if others wouldn't buy it.
  - dmoy 3y ago
    > My point was more that the data presented in the article aren't very useful on their own. Yea this is a constant issue in almost all journalism. Numbers are provided mostly without context. E g. "$100k of drugs seized in bust". But was that a single day's re-up? Does it meaningfully impact the local drug supply at all? --- In this case we can dig into numbers somewhat. Bitcoin.com claims the traditional banking sector uses about 2x as much energy. But cryptocurrency handles a tiny, tiny fraction of worldwide banking stuff, so if it was operating at the scale of e.g. 20,000 qps of credit card transactions, for example, it might have substantially higher energy use compared to now.
Symbiote 3y ago
Visa used 189GWh in 2017, worldwide, of which around half was data centres [1]. That handled 111.2 billion transactions, so about 1.7Wh per transaction (half for datacentres). Bitcoin used 844670Wh per transaction [2]. [1] https://usa.visa.com/dam/VCOM/download/corporate-responsibility/visa-2017-corporate-responsibility-report.pdf https://usa.visa.com/dam/VCOM/download/corporate-responsibil... [2] https://digiconomist.net/bitcoin-energy-consumption https://digiconomist.net/bitcoin-energy-consumption
- qqqwerty 3y ago
  That is bonkers if true. To put some context around that, our EV can drive around 4000 miles on that amount of energy. Meanwhile, I am not sure you could even unlock the car on 1.7Wh.
  - danbruc 3y ago
    1.7 Wh is 1,000 W for 6 seconds, I really hope that this is enough to unlock a car.
  - manquer 3y ago
    Why is it bonkers ? Bitcoins are just speculative assets . All crypto is, nobody is actually doing real economic transactions on them, I.e buying and selling services/goods for bitcoin. It is not practical to do so with transaction/gas fees . If you think of it as an Asset transactions then it makes sense, those are always expensive. A real estate deal for a house will have buyer agent, seller agent government taxes etc easily 5-10% , if you sell an artwork a gallery will probably charge upwards of 10-20% etc.
    - qqqwerty 3y ago
      A digital currency using ~844 kWh per transaction is absolutely bonkers. This is irrespective of any fees, taxes, or commissions associated with the transaction. If I buy real estate with bitcoin, all of those would still apply, but my choice of using bitcoin would result in an extra 844 kWh of energy consumed compared to using cash. Bonkers.
josu 3y ago
>re: 4 "The results of this survey show that the members of the BMC and participants in the survey are currently utilizing electricity with a 63.1% sustainable power mix." https://bitcoinminingcouncil.com/ https://bitcoinminingcouncil.com/ The BMC is mostly composed of US miners.
spankalee 3y ago
> Energy consumption is frankly not a phenomenon I give two shits about, as an environmentalist. Fossil fuel consumption is. Sorry, but this is a ridiculous statement. Electricity is one of the most fungible things in existence, and renewables don't yet make up 100% of production, therefore any additional consumption _for the most part_ might as well be 100% generated from fossil fuels. Even if a miner has a contract with a solar farm for all of their power, that's still electricity that someone else could be using instead of electricity from fossil fuels.
- bsdpufferfish 3y ago
  Most miners are capturing energy through government corruption or through means that are not otherwise usable such as waste gas in oil fields or remote mills.
- dannyobrien 3y ago
  I'm not sure this is true, but happy to be proven wrong: if there was a geothermal source, say, hundreds of miles from anywhere, the transmission losses might make it uneconomic to exploit, but it would be usable for proof-of-work or a similar project. (Not arguing for or against this application, and it may be that this is too rare a phenomenon to matter; just quibbling over the fungibility.)
- digging 3y ago
  > Even if a miner has a contract with a solar farm for all of their power, that's still electricity that someone else could be using instead of electricity from fossil fuels. Not if the infrastructure wouldn't have been built without the miners.
303uru 3y ago
You're going to compare the entire banking system, which services essentially every American to this complete waste of time and resources which services a vanishingly small number of people? >The point is the amount of crypto being mined. Is it? According to who? You? What's the utility of crypto? I've yet to see any materialization other than casino and funding terrorism.
- digging 3y ago
  > Is it? Yes, because cryptocurrency is the thing we're measuring. The number of miners is meaningless in this conversation. It would be like talking about how many companies manufacture wind turbine blades.
- earthling8118 3y ago
  How would the power usage of bitcoin scale if it did serve every American? Until that question has an answer I don't think this argument can be considered valid. It's an incredible waste as it is, but just dismissing it outright doesn't make sense. If the number of transactions scaled up would the power usage become more reasonable?
  - ben_w 3y ago
    Bitcoin by itself cannot serve every American, regardless of power consumption, and that's by design. It can't even serve every lunch in Vermont without extra layers running on top of it.
themerone 3y ago
The us banking system is multiple orders of magnitude larger than the crypto markets.
robinsonb5 3y ago
To address two of your points in particular: 1. Even if the energy consumption of the traditional banking industry is comparable or higher, it supports the daily activities of literally 5 or 6 orders of magnitude more entities and people than the 137 outfits mentioned in TFA. 4. The environmental angle is only one aspect - the other is simply that energy costs have never been higher, and crypto mining adds another energy consumer competing against householders, pushing costs up yet further. (Yes, I know, crypto mining can be set up to happen only when there's spare capacity, and I'm sure the miners can be relied upon to act responsibly in that regard...)
Nullabillity 3y ago
Renewable energy burned on cryptocurrency mining is still displacing renewable energy that could have been burned on something else.
meetmyalias 3y ago
I’m no expert but I feel compelled to address your points: 1) “No comparison to the banking industry made” - sure, but the banking industry serves the entire world’s financial system, handling billions of transactions a second, while bitcoins transactions take anywhere from 30 minutes to two hours and process, like, 7 transactions a second. There is no reality we live in now where crypto transacts faster, more cheaply, than our current financial infrastructure. 2. Even if the it’s something g much lower, like .5%, point 1 above doesn’t absolve crypto from its share of energy expense for comparatively little work. 3. Again, splitting hairs and taking cover behind technicalities and specific figures doesn’t change the wider picture that crypto is insanely inefficient at what it’s trying to do compared to the financial systems it want to replace. I guess it’s clear I think it IS a waste of energy. 4. Where do you think the lions share of energy generation to feed crypto mining comes from? Even if it was purely renewable energy sources the gross inefficiency of crypto is still notable given its goals. There are better systems to do it.
deleted 3y ago
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stanleykm 3y ago
> If Bitcoin mining ends up using a higher proportion of renewable energy than, say, traditional banking, it could be seen as a net good for crypto use to rise On the other hand if crypto being on renewables is displacing things that otherwise would have been - is that a win?
- LtWorf 3y ago
  He doesn't care. He just wants to do his get rich quick schemes.
eli 3y ago
1. There's no need to compare to traditional banking. 2% of all US power is a lot -- the comparison is to all other uses of electricity. (But per-transaction traditional banking is orders of magnitude more efficient.) 2. "I haven't read the study but maybe it's wrong and maybe the real number is way way less"? C'mon. Give me a break. Trusting that an EIA report is generally accurate is not evidence of being "emotional." Handwaving it away without even reading it is. 3. It's interesting and newsworthy that a small number of players are using a tremendous amount of electricity. The article is about bitcoin mining. "Video games" probably use a lot of electricity too, but dispersed across hundreds of millions of users. 4. You're entitled to that opinion, but I assure you that caring about massive energy consumption is not evidence of an anti-bitcoin conspiracy.
- digging 3y ago
  > "I haven't read the study but maybe it's wrong and maybe the real number is way way less"? C'mon. Give me a break. Trusting that an EIA report is generally accurate is not evidence of being "emotional." Handwaving it away without even reading it is. That's not what I said. I said the author of the article did read the study and describes it as possibly wrong. In fact the article does actually mention a range given, "0.6% to 2.3%", which isn't orders-of-magnitude huge but nearly a 1:4 ratio. Usually if someone says, "I have this big scary number," and you find out the actual number is 25% of what they told you, you're allowed to be skeptical of the conclusions they draw from their math.
  - eli 3y ago
    With all due respect, maybe you should read the report. The 137 facilities they are talking about use an 2.3% of US electricity when run at capacity. Separately they use CEBCI data to come up with a top-down estimate of bitcoin mining at 0.6% to 2.3% of US electricity. Putting the two together suggests the true number is at the high end of the range.
ziddoap 3y ago
You're brave to even remotely hint that you're in favor of crypto on HN! >Energy consumption is frankly not a phenomenon I give two shits about, as an environmentalist. Despite a few people specifically calling this sentence out as 'ridiculous' or whatever, I think this is a completely valid point. If 100% of the energy powering something comes from renewables, who gives a shit?
- digging 3y ago
  I don't even like it, I kind of wish it hadn't been invented, but rationality is vanishingly rare when it's discussed. And I am certain many will say the same of everything I post.
  - Symbiote 3y ago
    You justified it above as being useful for scammers and speculative investors. It's rational to conclude the costs are not worth those supposed benefits.
    - digging 3y ago
      Everything is useful for scammers. I don't know if crypto has significantly increased the rate of non-rich people being scammed.
  - amarant 3y ago
    I've just posted a comment criticising one of your other posts about this, but I feel now I need to clarify I don't think your entire post is irrational, just that it contains a few erroneous assumptions, and in at least one place fails to consider what I would deem a noteworthy concern. I agree that most arguments in this area resembles tribal war more than rational debate, much like any discussion involving either trump or musk, where rationality is also thrown out the window in favour of signalling tribal affiliation
- amarant 3y ago
  I dunno. I see your point, but at the same time there's the opportunity cost to consider. We simply cannot currently generate enough renewable energy to cover all our energy needs, so if you are wasting power that could've been used for something more important, it's a waste regardless of the source of your energy. The more energy society demands, the more likely it becomes that some of it is generated by coal. And does it really matter which electrons are used for what at the end of the day?
jcranmer 3y ago
> 1. There is no comparison made to the energy consumption of the traditional banking industry, which I am sure is not a particularly energy-efficient industry. I ran the numbers a few days ago (see https://news.ycombinator.com/item?id=39234766 https://news.ycombinator.com/item?id=39234766). Bitcoin miners plausibly use more energy than the entire traditional banking sector. Not just on a per-transaction basis (which is blindingly obvious if you think about it), but on a gross energy consumption basis.
- rightbyte 3y ago
  "There are 2,595,852 people employed in the Commercial Banking industry in the US as of 2023" -- Google Blackbox Content Steal So less than 1% of US pop. in banking sector. And I guess banking use less power than e.g. mining, manufacturing per worker ... Bitcoin probably uses more energy then the banking industry and their workers living their lives.
amarant 3y ago
Given that renewable energy produced is not infinite, any waste of energy can be assumed to use coal since not wasting that energy would reduce the amount of coal power needed at any given moment. Now, the above argument is only relevant if we can prove that Blockchain transactions actually are a waste of energy, and you seem to attempt to argue against that as well, by asking for a comparison with the traditional banking system. I'm not sure that the traditional banking system add a whole uses less energy than Blockchain as a whole, but I AM sure that the traditional banking system handles several orders of magnitude more transactions than all Blockchains does combined, and absent any proof to the contrary, I'm assuming the traditional banking system is not using more than an order of magnitude more energy than Blockchain(since that would mean that traditional banks use around 23% of American energy, which is an absurd amount of energy) As long as Blockchain uses more energy per transaction than traditional banking, it's a waste of energy, relatively speaking. And while I don't currently have any good sources to prove this point, I see very little reason to believe Blockchain isn't using at least 2 orders of magnitude more energy than traditional banking per transaction.
ooterness 3y ago
In terms of energy consumption per transaction, it's not even close. Digieconomist [1] states that a single Bitcoin transaction is "equivalent to the carbon footprint of 1,044,177 VISA transactions or 78,521 hours of watching Youtube." Statista [2] estimates a similar energy-cost ratio of about 470,000 Visa transactions to 1 Bitcoin transaction. https://digiconomist.net/bitcoin-energy-consumption https://digiconomist.net/bitcoin-energy-consumption https://www.statista.com/statistics/881541/bitcoin-energy-consumption-transaction-comparison-visa/ https://www.statista.com/statistics/881541/bitcoin-energy-co...
banannaise 3y ago
Energy consumption by banking? We can calculate that. All commercial buildings in the United States used about 6.8 trillion BTUs, or 2 trillion kWh (2 petawatt-hours), of power in 2018 [1]. That's just over half of the 3.9 petawatt-hours used by the country as a whole [2]. Of that, 16% was consumed by offices [3], so we're down to 8%. That's all office buildings, so what percentage of office building space is devoted to banking? Does banking use more than 1/3 of total office space in the United States? If so, you have a point. That seems highly unlikely. (Datacenters used less than 0.1 petawatt-hours in 2020 [4], or about 2% of total energy consumption. Again, I doubt banks were using the lion's share of that, so it doesn't move the needle much.) [1] https://www.eia.gov/energyexplained/use-of-energy/commercial-buildings.php https://www.eia.gov/energyexplained/use-of-energy/commercial... [2] https://www.globaldata.com/data-insights/power-and-utilities/the-power-consumption-in-united-states-of-america-1083501/ https://www.globaldata.com/data-insights/power-and-utilities... [3] https://www.eia.gov/consumption/commercial/pba/office.php#:~:text=Office%20buildings%20accounted%20for%2017,energy%20consumption%20in%20commercial%20buildings https://www.eia.gov/consumption/commercial/pba/office.php#:~.... [4] https://eta.lbl.gov/publications/united-states-data-center-energy#:~:text=Based%20on%20current%20trend%20estimates,73%20billion%20kWh%20in%202020 https://eta.lbl.gov/publications/united-states-data-center-e....
- digging 3y ago
  > Energy consumption by banking? We can calculate that. Great, thank you for doing so. I wish TFA had given even half this effort.
- duskwuff 3y ago
  > Datacenters used less than 0.1 petawatt-hours in 2020 [4], or about 2% of total energy consumption. FWIW, that's a projection from 2016, but it should still be in the right ballpark. Comparing Bitcoin power usage to all other data center power usage is also enlightening. Those data centers are hosting the majority of the world's online services as well as providing services used by physical businesses; they're doing a lot more useful work, for more people, than Bitcoin is.
ben_w 3y ago
> 1. There is no comparison made to the energy consumption of the traditional banking industry Sure, but 2.7% of USA's electricity is almost certainly more than all of traditional banking. Now, I've just tried googling that, but the results are clearly being distorted by the exact things you're complaining about here, with estimates varying from 15.8 GW to 558 GW worldwide and that higher value being about 20% of global electrical demand which is obviously wrong as it's a bit more than the entire commercial/public sector of the global economy combined. > which I am sure is not a particularly energy-efficient industry. Compared to what it could be, perhaps. But it would be surprising if it was as bad as a system which specifically regards using as much computational power as possible to be a security measure. > The point is the amount of crypto being mined. But that's designed to be independent of the energy use? Also, mining isn't the value proposition of a currency, transactions are. One of the arguments that I often hear that's supposed[0] to be in support of bitcoin, is that it prevents inflation. But mining is inflation. Unfortunately, Bitcoin specifically has a transaction limit too small for just interbank balancing, let alone for direct personal use — for that, the system-wide limit would only barely cover Berliners taking cash out of ATMs once per week. > If Bitcoin mining ends up using a higher proportion of renewable energy than, say, traditional banking, it could be seen as a net good for crypto use to rise. No. To find out why, let's take it to absurd levels: build a Dyson swarm, cover the sun, use all that to mine crypto. What changes, economically or environmentally? Nothing. Literally nothing. The rest of the economy doesn't get greener, there isn't any more cryptocurrency than there would have been, the transaction rate hasn't changed. [0] it doesn't actually support Bitcoin, but why is out of scope for this comment
tgsovlerkhgsel 3y ago
Thanks for pointing out that the amount of power consumed is speculative and "up to" - it's reported as a fact in the headlines everywhere. We can get a reasonable upper bound: the block reward is 6.25 BTC + fees (the blocks I saw tended to have around 0.5 BTC in fees), so let's be generous and say 7 BTC per block. 144 blocks per day are 52560 blocks or 368k BTC per year. Currently, they're worth 47k each, so $17.3B/year. The 91 TWh figure (from https://www.eia.gov/todayinenergy/detail.php?id=61364 https://www.eia.gov/todayinenergy/detail.php?id=61364) seems derived directly from a 240 TWh global power consumption multiplied by the assumed % of mining happening in the US, so since we're using global revenue, it only makes sense to use the global number, 240 TWh = 240e9 kWh. 17.3e9 USD / 240e9 kWh => 7.2 ct/kWh That's the absolute maximum that electricity could cost in order for mining to be profitable. That's making some very generous assumptions - I used the current price (annual high!) instead of the much lower average over the past months or year, and it completely ignores the very significant cost of the mining hardware. But given that 7.2 ct/kWh is roughly what industrial electricity costs in the US, and miners might be able to get power cheaper (since they can be more flexible than e.g. an aluminium plant that would suffer expensive damage if power is cut unexpectedly), it's not an entirely unreasonable number for an upper bound. Getting accurate numbers through mandatory reporting isn't the worst idea, if only to prevent such bullshit headlines.
- pcthrowaway 3y ago
  It's an "estimate" but if the mining operations of these 137 miners have known addresses (which I assume they have to for compliance), it's going to be accurate within 20%. The block reward is irrelevant, we just need to look at the hashrate of the network Basically, take the overall hashrate of the entire network which is determined from the block difficulty (this fluctuates and was likely higher when bitcoin was more valuable, though not necessarily), and assume all blocks are mined by operators running state of the art mining hardware (realistically 90-98% of blocks will be mined by people running hardware that's 80-100% of the maximum possible efficiency, and any miners running worse hardware will be consuming more energy, but we can pretend they're all on the best hardware) Using that, you can get the overall hashrate of the network. Once you have that, you can take the percentage of blocks mined by these 137 miners in a year. Again, be generous and assume they're all running state of the art hardware. If 10% of all blocks are mined by these 137 mining ops, guess what, they're using 10% of the total energy being inhaled by the network.
throw0101d 3y ago
> Energy consumption is frankly not a phenomenon I give two shits about, as an environmentalist. Fossil fuel consumption is. Production of any energy causes pollution: those wind turbines and solar panels aren't carbon-free, they took a bunch energy/carbon to produce ("embodied carbon"). Increasing energy use for anything causes the need to produce new plants to be built. If you can use less energy to produce the same results and thus reduce demand it may obviate the need for more more supply in the first place.
wiseowise 3y ago
> 1. There is no comparison made to the energy consumption of the traditional banking industry, which I am sure is not a particularly energy-efficient industry. That’s irrelevant. Banks aren’t going anywhere, end of story. Maybe not in a current form, but they’ll stay, just because of sheer amount of infrastructure built on them.
FabHK 3y ago
Re 1. The traditional banking industry does a lot (a lot!) more than moving entries in a ledger from A to B. That, in fact, is a minuscule part of what's going on. Re 3. My rule of thumb is that crypto uses about 1% of world electricity production [1]. I'm surprised that the US has such a disproportionate high proportion of mining, indicative of cheap energy & lax regulation? [1] Note that electricity is roughly a fifth of energy production (the rest being fuel for transportation/heating).
KMag 3y ago
Former banker here. There's extremely little overlap between traditional banking and what cryptocurrency does. There's more overlap with what a credit card company does. Most of traditional banking is about financing, not about money transfer. The risk estimation and risk control are the tough parts of financing, and I don't see how on-chain computation is a good fit for that risk modeling. So, "What's the energy cost of the combined Visa and Mastercard networks" is a much better benchmark than "What's the combined energy cost of the traditional banking system?" One big energy use I optimized was daily risk calculation for exotic books. Say an Australian insurance company sold a bunch of life insurance in Japan. They want to cap their losses on $5 billion USD notional (maybe 2,500 policies, each for $2 million) over the next 30 years, and they want to cap their losses at $1.5 billion AUD. This extremely bespoke, not something the bank can offload to another entity, so the bank is pretty much stuck with this re-insurance on its books for the next 30 years. How much does the bank need to keep on-hand in case this goes sour? To answer that question, every day the bank needs to run Monte Carlo simulations to cover shifts in the Japanese life expectancy curve and shifts in the JPY/AUD exchange rate over the next 30 years. It turns out that for some of these exotic options contracts, just compute cost for calculating risk exposure over the lifetime of the trade can end up being a noticeable percentage of the profit from the trade. Sure, you could pull some of that simulation compute on-chain in smart contracts, but what does a DAO do when it has insufficient reserves to cover its outstanding obligations? I guess you need a diverse enough DAO so its risk exposures are sufficiently uncorrelated, but that means that it needs to do vastly more computation to calculate its current exposure every time someone asks the DAO to enter into an obligation. Either all miners need to redundantly run these calculations, or you push them off-chain. If you push the risk calculations off-chain, then you're back to the energy consumption being very different than the traditional banking system.
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lp4vn 3y ago
Sure, you must be an anti-crypto obsessed person if you are against something essentially useless like bitcoin having a trillionaire market cap and using 2% of the energy of a whole country.
sak5sk 3y ago
exactly. oooh, computing uses energy! Surprise! Now do porn consumption.

mjburgess 3y ago

The "security" of btc cryptocurrency is proportional to how much energy it wastes; that's radically different than the banking system. The more billions it costs to run bitcoin, the more it costs to 51% attack it. If you can outwaste energy, you can hijack the system. It would be useful it some state, eg., russia or china, would just cut off networks and forge bitcoin network traffic -- and hence bring the whole thing down. Or, do a 51% attack by controlling 51% of the hashing power. The whole thing is a joke, one only tolerated by states because it's supports joke levels of economic transactions. Were any % of an economy to run on this, states would just seal the network in their borders and end the whole charade.

snapcaster 3y ago
How would they seal the network in their borders? Why would that bring the whole thing down? Countries that shut down internet don't seem to bring that whole thing down in any sense
- lovich 3y ago
  https://xkcd.com/538/ https://xkcd.com/538/ Countries have this neat tool called violence that tends to override all security whenever humans are a linchpin
  - hk__2 3y ago
    > Countries have this neat tool called violence that tends to override all security whenever humans are a linchpin That doesn’t work with distributed systems. No single country is able to shut the whole Internet down, for example.
    - manquer 3y ago
      They don’t need to shutdown for everyone , they need to shutdown only for their country . Countries do this all the time , just yesterday we were talking about internet shutdown during elections and exams , then there are restricted countries like say North Korea.
    - ben_w 3y ago
      0) yes they do, in extremis half a dozen HAEMP would basically take out the whole internet (b) "seal the network in their borders" is much easier than that, lots of networks basically act like that already due to either voluntary compliance with local laws, or due to direct government interference with the networks iii. the miners aren't really all that distributed, they group together for the same reason everyone else groups together instead of being free-range anarchists [δ] all you need to do to shut down a currency within a country is arrest people using it, which is very easy and has a long history
    - lovich 3y ago

burnished 3y ago

Looks like it has a bigger share than early 2000s US aluminum processing (a notoriously electricity intensive process), which was using 1.5% https://www.aceee.org/files/proceedings/2003/data/papers/SS03_Panel1_Paper02.pdf https://www.aceee.org/files/proceedings/2003/data/papers/SS0...

latchkey 3y ago
Coinmint operates in an old Alcoa plant in upstate NY near Canada. It runs entirely off a dam that was built to power smelting. Power that would otherwise be going to waste (the location is too remote and too expensive to transmit elsewhere). By using the power, it actually helps keep the dam running. https://www.coinmint.one/ https://www.coinmint.one/ Update: if you're going to downvote me, see below before you do so. I have been there, I have seen it, I have talked to people who worked at the plant and the dam.
- manquer 3y ago
  > too expensive to transmit elsewhere Citation needed . It is rarely if ever too expensive to transmit electricity anywhere . We have offshore wind solar farms in remote places , there is even cross continent lines between Africa and Spain . I am deeply skeptical it is too expensive for upstate NY to transmit power when there is probably 50 million people living in metro areas within say a 750 mile radius . Every other dam is remote, every coal plant is remote they are all perfectly able to transmit to urban and industrial centers
  - latchkey 3y ago
    Look on a map. There is nothing (in the US) that is close to there that would consume the ~500MW of power the dam produces and sends to the plant. The plant was shut down and nobody made an effort to direct the power elsewhere. Transmission is insanely expensive at scale. I've seen their power bills and I talked to their head electrician who worked at the plant when it was operational. That's the best citation I can give you, sorry.

misnome 3y ago

> 1. There is no comparison made to the energy consumption of the traditional banking industry, which I am sure is not a particularly energy-efficient industry. Despite declaring yourself not one, this (and every other one of your points) comes up _every single time_ crypto proponents are trying to seed FUD in any reporting about the energy usage of crypto. This is especially laughable when you then say > ~2% of US power is generating over 1/3 of the world's Bitcoin. It's good to know that it takes 2% of the US power grid to power 2.3 transactions per second. By your own argument - unless the traditional banking industry tops out at 100% of US power usage for 115 transactions per second - it is definitely not worse than bitcoin.

digging 3y ago
> Despite declaring yourself not one, this (and every other one of your points) comes up _every single time_ crypto proponents are trying to seed FUD in any reporting about the energy usage of crypto You have it backward, it comes up when reporting tries to seed FUD about crypto energy usage. Every point I made is that this article isn't actually saying anything obviously scary, it's just saying some facts in a scary voice. > By your own argument - unless the traditional banking industry tops out at 100% of US power usage for 115 transactions per second - it is definitely not worse than bitcoin. That's not my argument. They do different things. Despite its name, most cryptocurrency isn't really used as currency. As you say, it's slow and not very useful for that. I'm just making a comparison because most of the thoughtless FUD discussion assumes that USD is free (in energy terms).
elevaet 3y ago
> this comes up _every single time_ crypto proponents are trying to seed FUD And it's worth pointing out that it comes up every single time without a shred evidence, just a hunch that the crypto enthusiast ensures us is correct. I'd love to see some actual numbers on the energy consumption of the banking industry vs. crypto. Or lets be real, let's compare the amount of energy used by the banking sector to provide the same store of value and 3 transactions per second or whatever minor utility BTC provides.
- digging 3y ago

boc 3y ago

> I'm not a crypto proponent per se Yet you rolled out the standard crypto talking points flawlessly. > Energy consumption is frankly not a phenomenon I give two shits about, as an environmentalist Again, I suspect you aren't an environmentalist either. Please just be straightforward with your motivations here.

digging 3y ago
Your suspicions are wrong, but you're welcome to add to the debate if you have anything to contribute.
- boc 3y ago
  I'll be upfront with you: bitcoin is probably the worst "tech" ever mass-adopted. That's my bias. 1. The banking industry is thousands of times more important that crypto for everyday Americans. It's what literally makes our entire economy run. Crypto is used for speculation. What you should be comparing bitcoin against is the energy it takes to list a few ETFs on an exchange, which is essentially the cost of a few hundred servers, aka nothing. Bitcoin is ungodly inefficient and will only become more inefficient. 2. "It could be less, much less, or much less," This is a filler argument. Study says "around" a number, so you're arguing it could be a really broad definition of "around"? Not a serious take. 3. The absolute number matters because it's showing the economic activity is being concentrated in the pockets of just 137 entities. This is NOT a broad-base economic phenomenon that helps employ people in communities around the country, like say running gas stations (another polluting industry). If you're going to use 2% of the nation's electricity, you'd want the benefits spread across at least 2% of the population. Not 0.00002%. 4. Net energy consumption pulls from our current energy grid. Within a grid, if you use more clean electricity in one area, it'll pull more supply from dirtier sources elsewhere. Saying that bitcoin mining helps "green" the grid is a myth because you have to mine it 24/7/365, which means intermittent sources like wind and solar are at a big disadvantage. Battery storage tech is not there yet, thus gas plants and dirtier sources have to kick-in to keep up with 24/7 consumption.
  - digging 3y ago

abeppu 3y ago

Regarding 1, I haven't seen comparisons to the overall energy consumption of the banking sector, but a lot of people have talked about the per-transaction energy of bitcoin vs other kinds of transactions, and the ratio is pretty crazy. I don't think banking is "particularly energy-efficient", but there's not a lot of reason for it to be especially energy intensive. The information surrounding accounts/transactions/portfolios etc is all pretty concise. https://www.statista.com/statistics/881541/bitcoin-energy-consumption-transaction-comparison-visa/ https://www.statista.com/statistics/881541/bitcoin-energy-co...

Devasta 3y ago

> Energy consumption is frankly not a phenomenon I give two shits about, as an environmentalist. Fossil fuel consumption is. If an org has a big polluting coal plant powering a bunch of crypto miners and with a wave of a magic wand I give them an equivalent amount of clean renewable energy, they wouldn't turn off the coal plant, rather they would just double the number of hashes they are pumping out. Proof of work is designed to be as wasteful as possible, it will never ever be efficient or environmentally friendly.

tootie 3y ago

The difference is that crypto mining is a purely contrived exercise. BTC could just as easily be allocated based on how many trees you plant. It's arbitrary.

acdha 3y ago

> There is no comparison made to the energy consumption of the traditional banking industry, which I am sure is not a particularly energy-efficient industry. This is your first mistake: the traditional banking system does not have a security model predicated on the ability to waste power. Bitcoin does, and it’s dynamic so there’s no way to waste less power which isn’t explicitly ceding control. The second error is treat the two as comparable without recognizing that one of them is used daily by millions of people making billions of transactions, and the other has almost no real world adoption. That matters in two ways because it’s not just that bitcoin uses more power to do so much less but also that the real financial system has higher power draw for work in addition to processing transactions. For example, Visa can do on the order of tens of thousands of transactions per second versus Bitcoin’s 7 but if you are looking at how much power they use, the figures will include running a ton of anti-fraud and other support systems which Bitcoin is missing.

digging 3y ago
I do admit that the comparison is not a strong one. It wasn't intended to be, honestly, it was just an easy example. My point was more that the data presented in the article aren't very useful on their own. Again, if you think all cryptocurrency has 0 value, then all usage is obviously bad. But the reality is that it has some value, and much of that value is in the form of scams (most types of coins, by number, are scams), and much of the value is just speculative investment, but it is a real thing that people spend real money on. Focusing on miners makes it seem like all the value of crypto comes directly from energy - but nobody would spend energy mining it if others wouldn't buy it.
- dmoy 3y ago
  > My point was more that the data presented in the article aren't very useful on their own. Yea this is a constant issue in almost all journalism. Numbers are provided mostly without context. E g. "$100k of drugs seized in bust". But was that a single day's re-up? Does it meaningfully impact the local drug supply at all? --- In this case we can dig into numbers somewhat. Bitcoin.com claims the traditional banking sector uses about 2x as much energy. But cryptocurrency handles a tiny, tiny fraction of worldwide banking stuff, so if it was operating at the scale of e.g. 20,000 qps of credit card transactions, for example, it might have substantially higher energy use compared to now.

Symbiote 3y ago

Visa used 189GWh in 2017, worldwide, of which around half was data centres [1]. That handled 111.2 billion transactions, so about 1.7Wh per transaction (half for datacentres). Bitcoin used 844670Wh per transaction [2]. [1] https://usa.visa.com/dam/VCOM/download/corporate-responsibility/visa-2017-corporate-responsibility-report.pdf https://usa.visa.com/dam/VCOM/download/corporate-responsibil... [2] https://digiconomist.net/bitcoin-energy-consumption https://digiconomist.net/bitcoin-energy-consumption

qqqwerty 3y ago
That is bonkers if true. To put some context around that, our EV can drive around 4000 miles on that amount of energy. Meanwhile, I am not sure you could even unlock the car on 1.7Wh.
- danbruc 3y ago
  1.7 Wh is 1,000 W for 6 seconds, I really hope that this is enough to unlock a car.
- manquer 3y ago
  Why is it bonkers ? Bitcoins are just speculative assets . All crypto is, nobody is actually doing real economic transactions on them, I.e buying and selling services/goods for bitcoin. It is not practical to do so with transaction/gas fees . If you think of it as an Asset transactions then it makes sense, those are always expensive. A real estate deal for a house will have buyer agent, seller agent government taxes etc easily 5-10% , if you sell an artwork a gallery will probably charge upwards of 10-20% etc.
  - qqqwerty 3y ago
    A digital currency using ~844 kWh per transaction is absolutely bonkers. This is irrespective of any fees, taxes, or commissions associated with the transaction. If I buy real estate with bitcoin, all of those would still apply, but my choice of using bitcoin would result in an extra 844 kWh of energy consumed compared to using cash. Bonkers.

josu 3y ago

>re: 4 "The results of this survey show that the members of the BMC and participants in the survey are currently utilizing electricity with a 63.1% sustainable power mix." https://bitcoinminingcouncil.com/ https://bitcoinminingcouncil.com/ The BMC is mostly composed of US miners.

spankalee 3y ago

> Energy consumption is frankly not a phenomenon I give two shits about, as an environmentalist. Fossil fuel consumption is. Sorry, but this is a ridiculous statement. Electricity is one of the most fungible things in existence, and renewables don't yet make up 100% of production, therefore any additional consumption _for the most part_ might as well be 100% generated from fossil fuels. Even if a miner has a contract with a solar farm for all of their power, that's still electricity that someone else could be using instead of electricity from fossil fuels.

bsdpufferfish 3y ago
Most miners are capturing energy through government corruption or through means that are not otherwise usable such as waste gas in oil fields or remote mills.
dannyobrien 3y ago
I'm not sure this is true, but happy to be proven wrong: if there was a geothermal source, say, hundreds of miles from anywhere, the transmission losses might make it uneconomic to exploit, but it would be usable for proof-of-work or a similar project. (Not arguing for or against this application, and it may be that this is too rare a phenomenon to matter; just quibbling over the fungibility.)
digging 3y ago
> Even if a miner has a contract with a solar farm for all of their power, that's still electricity that someone else could be using instead of electricity from fossil fuels. Not if the infrastructure wouldn't have been built without the miners.

303uru 3y ago

You're going to compare the entire banking system, which services essentially every American to this complete waste of time and resources which services a vanishingly small number of people? >The point is the amount of crypto being mined. Is it? According to who? You? What's the utility of crypto? I've yet to see any materialization other than casino and funding terrorism.

digging 3y ago
> Is it? Yes, because cryptocurrency is the thing we're measuring. The number of miners is meaningless in this conversation. It would be like talking about how many companies manufacture wind turbine blades.
earthling8118 3y ago
How would the power usage of bitcoin scale if it did serve every American? Until that question has an answer I don't think this argument can be considered valid. It's an incredible waste as it is, but just dismissing it outright doesn't make sense. If the number of transactions scaled up would the power usage become more reasonable?
- ben_w 3y ago
  Bitcoin by itself cannot serve every American, regardless of power consumption, and that's by design. It can't even serve every lunch in Vermont without extra layers running on top of it.

themerone 3y ago

The us banking system is multiple orders of magnitude larger than the crypto markets.

robinsonb5 3y ago

To address two of your points in particular: 1. Even if the energy consumption of the traditional banking industry is comparable or higher, it supports the daily activities of literally 5 or 6 orders of magnitude more entities and people than the 137 outfits mentioned in TFA. 4. The environmental angle is only one aspect - the other is simply that energy costs have never been higher, and crypto mining adds another energy consumer competing against householders, pushing costs up yet further. (Yes, I know, crypto mining can be set up to happen only when there's spare capacity, and I'm sure the miners can be relied upon to act responsibly in that regard...)

Nullabillity 3y ago

Renewable energy burned on cryptocurrency mining is still displacing renewable energy that could have been burned on something else.

meetmyalias 3y ago

I’m no expert but I feel compelled to address your points: 1) “No comparison to the banking industry made” - sure, but the banking industry serves the entire world’s financial system, handling billions of transactions a second, while bitcoins transactions take anywhere from 30 minutes to two hours and process, like, 7 transactions a second. There is no reality we live in now where crypto transacts faster, more cheaply, than our current financial infrastructure. 2. Even if the it’s something g much lower, like .5%, point 1 above doesn’t absolve crypto from its share of energy expense for comparatively little work. 3. Again, splitting hairs and taking cover behind technicalities and specific figures doesn’t change the wider picture that crypto is insanely inefficient at what it’s trying to do compared to the financial systems it want to replace. I guess it’s clear I think it IS a waste of energy. 4. Where do you think the lions share of energy generation to feed crypto mining comes from? Even if it was purely renewable energy sources the gross inefficiency of crypto is still notable given its goals. There are better systems to do it.

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stanleykm 3y ago

> If Bitcoin mining ends up using a higher proportion of renewable energy than, say, traditional banking, it could be seen as a net good for crypto use to rise On the other hand if crypto being on renewables is displacing things that otherwise would have been - is that a win?

LtWorf 3y ago
He doesn't care. He just wants to do his get rich quick schemes.

eli 3y ago

1. There's no need to compare to traditional banking. 2% of all US power is a lot -- the comparison is to all other uses of electricity. (But per-transaction traditional banking is orders of magnitude more efficient.) 2. "I haven't read the study but maybe it's wrong and maybe the real number is way way less"? C'mon. Give me a break. Trusting that an EIA report is generally accurate is not evidence of being "emotional." Handwaving it away without even reading it is. 3. It's interesting and newsworthy that a small number of players are using a tremendous amount of electricity. The article is about bitcoin mining. "Video games" probably use a lot of electricity too, but dispersed across hundreds of millions of users. 4. You're entitled to that opinion, but I assure you that caring about massive energy consumption is not evidence of an anti-bitcoin conspiracy.

digging 3y ago
> "I haven't read the study but maybe it's wrong and maybe the real number is way way less"? C'mon. Give me a break. Trusting that an EIA report is generally accurate is not evidence of being "emotional." Handwaving it away without even reading it is. That's not what I said. I said the author of the article did read the study and describes it as possibly wrong. In fact the article does actually mention a range given, "0.6% to 2.3%", which isn't orders-of-magnitude huge but nearly a 1:4 ratio. Usually if someone says, "I have this big scary number," and you find out the actual number is 25% of what they told you, you're allowed to be skeptical of the conclusions they draw from their math.
- eli 3y ago
  With all due respect, maybe you should read the report. The 137 facilities they are talking about use an 2.3% of US electricity when run at capacity. Separately they use CEBCI data to come up with a top-down estimate of bitcoin mining at 0.6% to 2.3% of US electricity. Putting the two together suggests the true number is at the high end of the range.

ziddoap 3y ago

You're brave to even remotely hint that you're in favor of crypto on HN! >Energy consumption is frankly not a phenomenon I give two shits about, as an environmentalist. Despite a few people specifically calling this sentence out as 'ridiculous' or whatever, I think this is a completely valid point. If 100% of the energy powering something comes from renewables, who gives a shit?

digging 3y ago
I don't even like it, I kind of wish it hadn't been invented, but rationality is vanishingly rare when it's discussed. And I am certain many will say the same of everything I post.
- Symbiote 3y ago
  You justified it above as being useful for scammers and speculative investors. It's rational to conclude the costs are not worth those supposed benefits.
  - digging 3y ago
    Everything is useful for scammers. I don't know if crypto has significantly increased the rate of non-rich people being scammed.
- amarant 3y ago
  I've just posted a comment criticising one of your other posts about this, but I feel now I need to clarify I don't think your entire post is irrational, just that it contains a few erroneous assumptions, and in at least one place fails to consider what I would deem a noteworthy concern. I agree that most arguments in this area resembles tribal war more than rational debate, much like any discussion involving either trump or musk, where rationality is also thrown out the window in favour of signalling tribal affiliation
amarant 3y ago
I dunno. I see your point, but at the same time there's the opportunity cost to consider. We simply cannot currently generate enough renewable energy to cover all our energy needs, so if you are wasting power that could've been used for something more important, it's a waste regardless of the source of your energy. The more energy society demands, the more likely it becomes that some of it is generated by coal. And does it really matter which electrons are used for what at the end of the day?

jcranmer 3y ago

> 1. There is no comparison made to the energy consumption of the traditional banking industry, which I am sure is not a particularly energy-efficient industry. I ran the numbers a few days ago (see https://news.ycombinator.com/item?id=39234766 https://news.ycombinator.com/item?id=39234766). Bitcoin miners plausibly use more energy than the entire traditional banking sector. Not just on a per-transaction basis (which is blindingly obvious if you think about it), but on a gross energy consumption basis.

rightbyte 3y ago
"There are 2,595,852 people employed in the Commercial Banking industry in the US as of 2023" -- Google Blackbox Content Steal So less than 1% of US pop. in banking sector. And I guess banking use less power than e.g. mining, manufacturing per worker ... Bitcoin probably uses more energy then the banking industry and their workers living their lives.

amarant 3y ago

Given that renewable energy produced is not infinite, any waste of energy can be assumed to use coal since not wasting that energy would reduce the amount of coal power needed at any given moment. Now, the above argument is only relevant if we can prove that Blockchain transactions actually are a waste of energy, and you seem to attempt to argue against that as well, by asking for a comparison with the traditional banking system. I'm not sure that the traditional banking system add a whole uses less energy than Blockchain as a whole, but I AM sure that the traditional banking system handles several orders of magnitude more transactions than all Blockchains does combined, and absent any proof to the contrary, I'm assuming the traditional banking system is not using more than an order of magnitude more energy than Blockchain(since that would mean that traditional banks use around 23% of American energy, which is an absurd amount of energy) As long as Blockchain uses more energy per transaction than traditional banking, it's a waste of energy, relatively speaking. And while I don't currently have any good sources to prove this point, I see very little reason to believe Blockchain isn't using at least 2 orders of magnitude more energy than traditional banking per transaction.

ooterness 3y ago

In terms of energy consumption per transaction, it's not even close. Digieconomist [1] states that a single Bitcoin transaction is "equivalent to the carbon footprint of 1,044,177 VISA transactions or 78,521 hours of watching Youtube." Statista [2] estimates a similar energy-cost ratio of about 470,000 Visa transactions to 1 Bitcoin transaction. https://digiconomist.net/bitcoin-energy-consumption https://digiconomist.net/bitcoin-energy-consumption https://www.statista.com/statistics/881541/bitcoin-energy-consumption-transaction-comparison-visa/ https://www.statista.com/statistics/881541/bitcoin-energy-co...

banannaise 3y ago

Energy consumption by banking? We can calculate that. All commercial buildings in the United States used about 6.8 trillion BTUs, or 2 trillion kWh (2 petawatt-hours), of power in 2018 [1]. That's just over half of the 3.9 petawatt-hours used by the country as a whole [2]. Of that, 16% was consumed by offices [3], so we're down to 8%. That's all office buildings, so what percentage of office building space is devoted to banking? Does banking use more than 1/3 of total office space in the United States? If so, you have a point. That seems highly unlikely. (Datacenters used less than 0.1 petawatt-hours in 2020 [4], or about 2% of total energy consumption. Again, I doubt banks were using the lion's share of that, so it doesn't move the needle much.) [1] https://www.eia.gov/energyexplained/use-of-energy/commercial-buildings.php https://www.eia.gov/energyexplained/use-of-energy/commercial... [2] https://www.globaldata.com/data-insights/power-and-utilities/the-power-consumption-in-united-states-of-america-1083501/ https://www.globaldata.com/data-insights/power-and-utilities... [3] https://www.eia.gov/consumption/commercial/pba/office.php#:~:text=Office%20buildings%20accounted%20for%2017,energy%20consumption%20in%20commercial%20buildings https://www.eia.gov/consumption/commercial/pba/office.php#:~.... [4] https://eta.lbl.gov/publications/united-states-data-center-energy#:~:text=Based%20on%20current%20trend%20estimates,73%20billion%20kWh%20in%202020 https://eta.lbl.gov/publications/united-states-data-center-e....

digging 3y ago
> Energy consumption by banking? We can calculate that. Great, thank you for doing so. I wish TFA had given even half this effort.
duskwuff 3y ago
> Datacenters used less than 0.1 petawatt-hours in 2020 [4], or about 2% of total energy consumption. FWIW, that's a projection from 2016, but it should still be in the right ballpark. Comparing Bitcoin power usage to all other data center power usage is also enlightening. Those data centers are hosting the majority of the world's online services as well as providing services used by physical businesses; they're doing a lot more useful work, for more people, than Bitcoin is.

ben_w 3y ago

> 1. There is no comparison made to the energy consumption of the traditional banking industry Sure, but 2.7% of USA's electricity is almost certainly more than all of traditional banking. Now, I've just tried googling that, but the results are clearly being distorted by the exact things you're complaining about here, with estimates varying from 15.8 GW to 558 GW worldwide and that higher value being about 20% of global electrical demand which is obviously wrong as it's a bit more than the entire commercial/public sector of the global economy combined. > which I am sure is not a particularly energy-efficient industry. Compared to what it could be, perhaps. But it would be surprising if it was as bad as a system which specifically regards using as much computational power as possible to be a security measure. > The point is the amount of crypto being mined. But that's designed to be independent of the energy use? Also, mining isn't the value proposition of a currency, transactions are. One of the arguments that I often hear that's supposed[0] to be in support of bitcoin, is that it prevents inflation. But mining is inflation. Unfortunately, Bitcoin specifically has a transaction limit too small for just interbank balancing, let alone for direct personal use — for that, the system-wide limit would only barely cover Berliners taking cash out of ATMs once per week. > If Bitcoin mining ends up using a higher proportion of renewable energy than, say, traditional banking, it could be seen as a net good for crypto use to rise. No. To find out why, let's take it to absurd levels: build a Dyson swarm, cover the sun, use all that to mine crypto. What changes, economically or environmentally? Nothing. Literally nothing. The rest of the economy doesn't get greener, there isn't any more cryptocurrency than there would have been, the transaction rate hasn't changed. [0] it doesn't actually support Bitcoin, but why is out of scope for this comment

tgsovlerkhgsel 3y ago

Thanks for pointing out that the amount of power consumed is speculative and "up to" - it's reported as a fact in the headlines everywhere. We can get a reasonable upper bound: the block reward is 6.25 BTC + fees (the blocks I saw tended to have around 0.5 BTC in fees), so let's be generous and say 7 BTC per block. 144 blocks per day are 52560 blocks or 368k BTC per year. Currently, they're worth 47k each, so $17.3B/year. The 91 TWh figure (from https://www.eia.gov/todayinenergy/detail.php?id=61364 https://www.eia.gov/todayinenergy/detail.php?id=61364) seems derived directly from a 240 TWh global power consumption multiplied by the assumed % of mining happening in the US, so since we're using global revenue, it only makes sense to use the global number, 240 TWh = 240e9 kWh. 17.3e9 USD / 240e9 kWh => 7.2 ct/kWh That's the absolute maximum that electricity could cost in order for mining to be profitable. That's making some very generous assumptions - I used the current price (annual high!) instead of the much lower average over the past months or year, and it completely ignores the very significant cost of the mining hardware. But given that 7.2 ct/kWh is roughly what industrial electricity costs in the US, and miners might be able to get power cheaper (since they can be more flexible than e.g. an aluminium plant that would suffer expensive damage if power is cut unexpectedly), it's not an entirely unreasonable number for an upper bound. Getting accurate numbers through mandatory reporting isn't the worst idea, if only to prevent such bullshit headlines.

pcthrowaway 3y ago
It's an "estimate" but if the mining operations of these 137 miners have known addresses (which I assume they have to for compliance), it's going to be accurate within 20%. The block reward is irrelevant, we just need to look at the hashrate of the network Basically, take the overall hashrate of the entire network which is determined from the block difficulty (this fluctuates and was likely higher when bitcoin was more valuable, though not necessarily), and assume all blocks are mined by operators running state of the art mining hardware (realistically 90-98% of blocks will be mined by people running hardware that's 80-100% of the maximum possible efficiency, and any miners running worse hardware will be consuming more energy, but we can pretend they're all on the best hardware) Using that, you can get the overall hashrate of the network. Once you have that, you can take the percentage of blocks mined by these 137 miners in a year. Again, be generous and assume they're all running state of the art hardware. If 10% of all blocks are mined by these 137 mining ops, guess what, they're using 10% of the total energy being inhaled by the network.

throw0101d 3y ago

> Energy consumption is frankly not a phenomenon I give two shits about, as an environmentalist. Fossil fuel consumption is. Production of any energy causes pollution: those wind turbines and solar panels aren't carbon-free, they took a bunch energy/carbon to produce ("embodied carbon"). Increasing energy use for anything causes the need to produce new plants to be built. If you can use less energy to produce the same results and thus reduce demand it may obviate the need for more more supply in the first place.

wiseowise 3y ago

> 1. There is no comparison made to the energy consumption of the traditional banking industry, which I am sure is not a particularly energy-efficient industry. That’s irrelevant. Banks aren’t going anywhere, end of story. Maybe not in a current form, but they’ll stay, just because of sheer amount of infrastructure built on them.

FabHK 3y ago

Re 1. The traditional banking industry does a lot (a lot!) more than moving entries in a ledger from A to B. That, in fact, is a minuscule part of what's going on. Re 3. My rule of thumb is that crypto uses about 1% of world electricity production [1]. I'm surprised that the US has such a disproportionate high proportion of mining, indicative of cheap energy & lax regulation? [1] Note that electricity is roughly a fifth of energy production (the rest being fuel for transportation/heating).

KMag 3y ago

Former banker here. There's extremely little overlap between traditional banking and what cryptocurrency does. There's more overlap with what a credit card company does. Most of traditional banking is about financing, not about money transfer. The risk estimation and risk control are the tough parts of financing, and I don't see how on-chain computation is a good fit for that risk modeling. So, "What's the energy cost of the combined Visa and Mastercard networks" is a much better benchmark than "What's the combined energy cost of the traditional banking system?" One big energy use I optimized was daily risk calculation for exotic books. Say an Australian insurance company sold a bunch of life insurance in Japan. They want to cap their losses on $5 billion USD notional (maybe 2,500 policies, each for $2 million) over the next 30 years, and they want to cap their losses at $1.5 billion AUD. This extremely bespoke, not something the bank can offload to another entity, so the bank is pretty much stuck with this re-insurance on its books for the next 30 years. How much does the bank need to keep on-hand in case this goes sour? To answer that question, every day the bank needs to run Monte Carlo simulations to cover shifts in the Japanese life expectancy curve and shifts in the JPY/AUD exchange rate over the next 30 years. It turns out that for some of these exotic options contracts, just compute cost for calculating risk exposure over the lifetime of the trade can end up being a noticeable percentage of the profit from the trade. Sure, you could pull some of that simulation compute on-chain in smart contracts, but what does a DAO do when it has insufficient reserves to cover its outstanding obligations? I guess you need a diverse enough DAO so its risk exposures are sufficiently uncorrelated, but that means that it needs to do vastly more computation to calculate its current exposure every time someone asks the DAO to enter into an obligation. Either all miners need to redundantly run these calculations, or you push them off-chain. If you push the risk calculations off-chain, then you're back to the energy consumption being very different than the traditional banking system.

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lp4vn 3y ago

Sure, you must be an anti-crypto obsessed person if you are against something essentially useless like bitcoin having a trillionaire market cap and using 2% of the energy of a whole country.

sak5sk 3y ago

exactly. oooh, computing uses energy! Surprise! Now do porn consumption.