How Much Energy Does It Take to “Mine” Cryptocurrencies like Bitcoin?

Bitcoin and other cryptocurrencies are a relatively new way to make financial transactions, and while most people may have little understanding of how it all works, one thing is certain: It takes a lot of energy. In fact, according to recent research from the Oak Ridge Institute for Science and Education, it takes more energy to do all of the work involved in cryptocurrency "mining" than it does to extract precious metals such as gold. That's because although cryptocurrency is "mined," it's not done with picks and shovels. Instead, it involves completing a load of arithmetical processes to set up "blockchains" -- virtual ledgers that record transactions. An astronomical amount of electricity is needed to power the computers that perform these calculations. To mine a dollar's worth of bitcoin requires about 17 megajoules (MJ) of energy, which is more than three times the amount of energy required to mine a dollar's worth of copper or gold.

The cryptic world of cryptocurrency:

  • Back in 2010, the first thing ever purchased with bitcoin was pizza, at a price of 10,000 bitcoin.

  • Today, those 10,000 bitcoins -- worth $41 USD less than 10 years ago -- would be worth roughly $34 million USD.

  • Unlike paper money, bitcoin has a limited supply of 21 million; more than 80% of bitcoins have already been "mined."

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More Info: The Guardian

Discuss this Article

Post 1

Apples and oranges!

Your computer is on for other things, not just bitcoins. That is like carrying your mining equipment whenever you are awake. Plus your last line equates copper with gold. The mining costs maybe similar but the payoffs are far different.

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