in

“each bitcoin transaction cost over $100 in electricity” somehow I do not believe this

“each bitcoin transaction cost over $100 in electricity” somehow I do not believe this



View Reddit by __silhouetteView Source

Leave a Reply

Your email address will not be published. Required fields are marked *

GIPHY App Key not set. Please check settings

41 Comments

  1. Stuff like this is based on the number of transactions Bitcoin (layer1 i.e the blockchain) can process per second.

    However the thing they conveniently forget to mention is that the vast majority of transactions happen on layer 2 (i.e lightning network, exchanges and retail) and then thousands of transactions are periodically finalized in one go on the blockchain.

    The energy usage is also important as one person said to secure the network. Without it Bitcoin would be vulnerable to attack. If you’re going to have a digital world currency you need to have significant protections in place and real energy usage (in other words: hash power) isn’t something you hack or fake.

    Any time you see FUD about energy usage it is from people who either want to attack Bitcoin or don’t understand it.

  2. The electricity is not used for the transactions per se, but for securing the network. It would be like saying that the cost of maintaining Fort Knox is part of the cost of your bank transactions. Not outright wrong, but certainly not right either.

  3. FUD. The owner of fortune media is trying to buy Bitcoin at some discount price.

    The person that wrote the article does have a history of writing against Bitcoin.

    Also the owner of fortune “chatchaval jiaravanon” is heavily invested in blockchain(Lightnet-Halfass shit that rely on traditional banks to tranfer money using the so call “Blockchain”).

    It a scheme to grab you coins. Don’t fall for it.

  4. It’s a silly fallacy. There is no per-transaction electricity cost. It’s like saying every tik tok costs ten heartbeats because it takes that long to shoot. The electricity is being spent either way, the heart is beating either way.

  5. Well, let’s do the math. Current block reward is roughly $370,000. News reports say miners have a profitability of 75%, so that’s a bit less than $100,000 in costs. For the sake of argument assume that all of those costs are in electricity, and forget about facilities and equipment and maintenance and workers’ salaries. Each block contains around 4000 to 5000 transactions.

    That means electricity cost can be at most $20 to $25, but more realistically is half that at worst, probably less. And as pointed out, that’s layer 1, not counting that multiple transactions can happen on LN for every base layer transaction.

    Basic sanity check says “article is bullshit”.

  6. The electricity used doesn’t just enable transactions, it more importantly adds security to the protocol….what does the US military cost per unit of Visa transactions….it’s the same concept

  7. Another FUD article. Seems someone wants to liquidate longs and buy cheap.

    They are completely ignoring lightning. For each transaction on layer-1 there are +1000x happening on layer-2. A whole country (El Salvador) is using Bitcoin daily and those transactions don’t appear on layer-1, yet their lightning channel is secured thanks to the mining power that goes into layer-1.

  8. I really would like to know how they can say this “The report states that each Bitcoin transaction consumes 1,173 kilowatt hours of electricity”.

    What’s the calculation they made?

    It’s simply absurd, so the same could be done for the bottle of milk, how many electricity do you need to: manage the cow, feed the cow, build the bottle, make the milk, storage the milk, transport the milk, sell the milk, etc…

    Probably a lot more using the same calculations.

  9. Every single Bitcoin transaction—even buying a latte—consumes over $100 in electricity, says a new report
    BY
    SHAWN TULLY
    October 27, 2021 6:00 AM GMT+5:30

    Yesterday, I received via email a report that takes an original look at Bitcoin’s energy consumption. The study, from UK financial site MoneySuperMarket calculates the electricity cost of each Bitcoin transaction. If you buy a latte with Bitcoin, or send coins to friend for walking your dog, how much juice does the purchase or transfer consume? The answer is a blow to those fans who insist that Bitcoin will someday serve as a widespread currency that makes buying and selling things faster and cheaper.

    The report states that each Bitcoin transaction consumes 1,173 kilowatt hours of electricity. That’s the volume of energy that could “power the typical American home for six weeks,” the authors add. The Bitcoin mining that enables a purchase, sale or transfer, it posits, uses a slug of electricity that costs $176. That number is based on an average worldwide cost per kWh of 9.0 cents over the past 12 months.

    While the revelation that Bitcoin network devours $100-plus in electricity for a transaction that a credit card company could power for pennies is shocking, the $176 estimate appears much too high. The problem, says Alex de Vries, the Dutch economist whose website Digiconomist tracks Bitcoin’s carbon footprint, is the 9 cents mark for electricity costs. “I estimate that the average for Bitcoin miners is 5 cents,” he says. “And that’s a high number. Many are producing in super-low cost countries at 3 or 4 cents.” A figure of 9 cents per kWh would also put the electricity bill for minting each Bitcoin at $35,000. From this writer’s experience, the actual expense is far less. From late October of 2020 to mid-January of this year, Bitcoin was trading between $11,000 to $35,000, yet miners were still avidly powering their racks of ASIC computers to win more coins. Mines would have been shutting down if they’d been faced with paying more in electricity to make their product than they could sell it for.

    So let’s reduce the MoneySuperMarket number from 9 cents per kWh to the 5 cents favored by de Vries. That would put the average cost of producing a coin at around $19,000, which looks reasonable (and underscores the industry’s gigantic profitability as price hovers at over three times that level). At 5 cents, the electricity cost per transaction would fall from $176 to roughly $100.

    The stunning amount of electricity Bitcoin gobbles for just one transaction, and the cost of that power, raises a basic question. Is creating a “currency” by consuming all that energy a sound business model? Bitcoin’s drawback is that electricity is finite, and what Bitcoin uses, a family or a business can’t use. In several nations, Bitcoin mining is imposing severe stress on the grid. Kazakhstan, one of world’s leading crypto mining hubs and a top destination for producers displaced by the Chinese lockdown, is suffering blackouts caused by the industry’s sudden explosion within its borders. Its government is limiting producers to a fraction of the electricity they’re now deploying. Iran has also suffered severe shortages that’s led to ejecting producers, and tiny Abkhazia is raiding mines––many of them illegal––to forestall an energy crisis. El Salvador promises to subsidize newcomers that decamp there, even though it imports 30% of its electricity. Since its grid is operating at full capacity, an influx of miners would force the government to import more juice, at a higher price than the electricity it generates at home using its geothermal energy fed by volcanoes.

    “The miners leaving these countries will need to move to other countries, then they’ll destabilize the grid in the new countries,” says de Vries. “We’re looking at a rolling disaster.” The biggest threat to Bitcoin, he says, may not be its carbon footprint but its burden in overloading electrical grids around the world. As houses go dark and factories shutter, governments will leap into action, banning or severely curtailing mining. Bitcoin doesn’t need Halloween to spring more ghoulish surprises like the new one in Kazakhstan. There’s lots of talk about whether Bitcoin is “sustainable.” The bigger question is whether a business template that gets you booted from countries for taking power needed by families and businesses is sustainable.

  10. The amount of energy used by the Bitcoin network depends on the hashrate which is mostly motivated by the price. A new block is mined every 10 minutes regardless of whether you move some Bitcoin around or not.

  11. Misappropriation. Electricity is mainly used to secure the network, transactions are a facilitation at 7 per second. If you appropriate all of the electricity used to only transactions at 7 per second, you will get a stupid clickbait article title as such.

  12. Them – “Bitcoin uses too much electricity. It’s bad for the environment.”

    Me – “I agree. All electricity should be generated with nuclear power and renewables from here on out.”

    Them – “…Not like that… (I want to stifle all progress and keep using fossil fuels.)”

  13. USD is the de facto global currency. Every transaction in USD literally requires Muslim blood. Think about how many millions of people the US has murdered from the Revolutionary war to terrorist nuclear attacks on Japan to recently 20 years of executing Afghans and Iraqis? For what? To keep USD and US the fore front. I’m fine paying $100 in electricity cost. At least it’s doesn’t include executing Muslim children in the middle east.

  14. I’m guessing this statement actually holds water. If you add up the electrical costs for all miners over a 10-minute period and then divide that by the number of on-chain transactions in that period, $100 sounds about right.

    To those saying that it’s not for transactions but for security, well that’s just semantics. When I think of a transaction I think of that as *including* the security protocols of that transaction.

    And of course, this math only works if you don’t count Lightning transactions. Which will likely eclipse the number of on-chain transactions in the near future.

    Also in the future as block rewards dwindle and the value of bitcoin presumably begins to level off, miners won’t have the luxury of burning electrical budgets in the now for a payoff tomorrow. This will put downward pressure on the number of miners (Which of course will probably cause other unforeseen tirtiary effects).

  15. included mining fee, ye maybe it s true. if u make one btc transfer after being mined, it will cost 30000$ (mining plus 1 transfer) because mining a bitcoin is now very expensive.

What do you think?

Argentina set to launch Bitcoin ETFs – 360 Crypto World

Bitfarms Building Two New Farms Of 78 MW Capacity In Canada

Bitfarms Building Two New Farms Of 78 MW Capacity In Canada