Cryptocurrencies require much, if not more, energy to extract precious metals like copper, gold or platinum, according to some more recent calculations.
The figures were noted by Max Krause, a researcher at the Oak Ridge Institute for Science and Education, and Thabet Toloymat, an environmental engineer who works in Cincinnati, Ohio, in the United States.
The pair has tried to estimate the average amount of energy consumed to generate a dollar of stuff, and the bottom line is: the production of Bitcoin, Ethereum, Litecoin and Monero consumes at least the same amount of copper, gold, platinum and oxides of rare earth, apparently.
"From January 1, 2016 to June 30, 2018, we estimate that mining Bitcoin, Ethereum, Litecoin and Monero averages 17, 7, 7 and 14 MJ (MegaJoules) to generate $ 1, respectively", according to the duo, published in nature this week.
"Comparatively, the conventional extraction of aluminum, copper, gold, platinum and rare earth oxides consumed 122, 4, 5, 7 and 9 MJ to generate $ 1, indicating that (with the exception of 39; aluminum) the crypto-extraction consumed more energy than mining to produce an equivalent market value. "
The gold rush is over
The extraction of cryptographic money consumes energy because it involves software and hardware platforms competing with one another to add blocks to the blockchain of a currency, which is a digital ledger that publicly lists all the transactions for that particular funbux.
These blocks store transaction details, which is why they are strongly sought after. Miners are rewarded with digital currency whenever they calculate a block valid for the blockchain to be used.
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Potential blockchain transactions are first held in a transaction pool. Miners collect some of these proposed transactions and try to squeeze them into a candidate block for currency blockchain. The candidate block also refers to the block previously confirmed by the chain using its hash value. This is necessary to connect block blocks to form the blockchain.
All metadata for the proposed block is contained in its block header, which is inserted into a hash function that reduces metadata to a short signature. This signature is the hash of the candidate block.
Miners must construct candidate blocks from the transaction pool that each have a block hash less than or equal to a target value set by the currency network. If the candidate block meets these requirements, it is accepted by the network and added to the blockchain as a confirmed block, thus confirming the transaction it contains. It also refers to the previous block and the next block will refer to it, forming the digital ledger.
There! All this block hashing activity consumes a lot of energy as it is, fundamentally, a game of hypothesis. Miners compete to produce as many as possible per second to increase the likelihood that they can create an accepted block. The goal is to earn more money from crafting blocks than from costs, in energy and hardware, to extract them.
Custom chips are typically used to churn out potential blocking blocks at an alarming rate, absorbing a ton of energy in the process. Graphics card processors were popular for this task, but their use has disappeared this summer: custom chips are preferred for Bitcoin, while the price of GPU mined currencies, such as Etherum, has dropped, making it no longer economically viable to blow kilowatts of power on currency processing using graphic chipsets.
The dollar value of cryptocurrencies like Bitcoin, Ethereum, Litecoin and Monero fluctuates, although the rate of calculation of hashes has increased over time. The percentage of researchers believe that, in August 2018, a whopping 50 quintillion (50 x 1018) hashes performed for the Bitcoin network, every second, every day.
More than simple calculation costs
Alas, all this mining and wasted calculation is expensive, in terms of energy costs and planting, and it's not good for the planet. According to the authors of the document, the extraction of all four cryptocurrencies in the period between January 2016 and June 2018 has caused the emission of carbon dioxide in the atmosphere from three to 15 million tons.
Bitcoin, the most widespread cryptocurrency and Litecoin, a currency very similar to Bitcoin, in particular are becoming very difficult to manage, as it is more difficult to generate a valid block, which requires more energy over time.
At present, the Bitcoin network consumes more energy in the whole of Ireland or Hong Kong, according to the newspaper. Monero's energy demand has declined and Ethereum may decline in the future.
Cryptocurrencies are in some ways similar to precious metals and minerals. It becomes increasingly difficult and expensive for me, and eventually the costs outweigh the reward. At this rate, it is estimated that 81% of the Bitcoins have been extracted and the last coins will be extracted in about 2140. ®