Cryptocurrency’s energy impact
Cryptocurrency mining is a difficult and expensive activity. Miners are required to pay heavily in order to buy rigs that are capable of huge amounts of processing power. The rigs also have to be powered with large quantities of electricity. There has to be a careful balance between the profitability and the operational costs.
There are no actual statistics depicting the electricity consumption in the mining process all over the world, but we know it is incredibly high. Recently, a Newyork Times Article addressed this issue and mentioned,
“The computer power needed to create a single digital token consumes at least as much electricity as the average American household burns through in two years, according to figures from Morgan Stanley and Alex de Vries, an economist who tracks energy use in the industry.”
The article also mentioned that, on average, a computer network for cryptocurrency mining utilizes the same amount of energy as a medium-sized country every day. Also, a single Bitcoin transaction computing requires almost 80,000 times more electricity than a credit card transaction.
Several cryptocurrency mining platforms and crypto experts have raised concerns about the probable harmful effects of crypto mining on the environment.
Even before crypto mining became this popular, the world was struggling to find a sustainable way of energy production. The climate change, global warming, and depletion of the ozone layer continuously threatens humanity.
On estimate, Bitcoin alone consumes 0.15% of the world's energy which far exceeds the energy consumption of small countries such as Ireland or several African nations.
But, there's a silver lining to this. Crypto experts understand the severity of this issue. They are working on alternative solutions to promote the growth of crypto space without harming the environment.
Environmentally friendly mining
Environmentalists, NGOs, and companies all over the world are fighting tooth and nail to protect the environment, and the crypto mining industry has joinied the cause. Luckily, the cryptocurrency space has few tools that can help to address this concern head-on.
One of the significant factors of crypto mining is its flexiblity. It has been pointed out several times in the past that crypto mining is not geographically restrained and can conduct its processes from anywhere in the world. This flexibility has incentivized several mining farms to choose a location with cheaper electricity costs.
Considering this, crypto mining farms can be located where the energy is not just cheapest but also the cleanest. The Facebook hydroelectric data center has made efficient use of this environmentally friendly model and demonstrated how this relationship can be established.
The company placed its data center in the Arctic, which reduced the equipment and the costs for cooling the servers artificially. The company also uses hydropower generated by nearby rivers. These steps helped reduce energy consumption by 40% while increasing efficiency by 10%.
Similarly, Andreas Antonopolous, a Bitcoin expert, agrees that crypto mining, instead of fossil fuels generated electricity, can use renewable energy plants to power the mining processes. One of the most promising renewable energy is solar energy which is easier to maintain and cost-efficient.
Solar panels usage has become popular among corporates and small-houses alike. It has a vast potential and is relatively cheaper to maintain than other renewable power plants such as wind plants or hydroelectric plants.
Mining farms with the capabilities to operate from deserts where there is ample solar energy can not only cut down their power costs but also do their part in saving the environment. Ideally, after setting up, you can virtually mine cryptocurrencies for free. It will help mining farms cut down on electric costs, significantly making the profits larger.
The good news is, few mining farms have already started working on using solar energy to power their activities. A mining farm with 25 separate computing rigs has been successfully running its operations using solar energy for a year now. The operation has been so successful that the firm plans to add 1000 more computers to the farm.
So, naturally, using solar panels to power a mining farm is an achievable and profitable solution. Also, deserts have a geographical advantage because of their vast unutilized space.
However, in deserts, the farms must have more robust cooling mechanisms as the rigs can break down due to heat. But considering the profits, these cooling mechanisms can easily be installed and maintained without cutting down profits significantly.
Crypto prices and mining costs
A cheap mining operation will undoubtedly increase profits, but for better yields, the price of cryptocurrencies must also remain high. Ideally, the cost of cryptocurrency must remain over $2000. Despite cryptocurrencies being highly volatile, it is unlikely that their prices will drop lower than the threshold.
As the cryptocurrency industry proliferates, it is imperative to harness renewable sources of energy to ensure a sustainable future. As more and more crypto experts and mining platforms are raising concerns and generating awareness about this serious issue, platforms such as Zionodes are stepping up.
It is more important than ever to use sustainable power sources without hindering the advancement of the crypto world. Everyone has a role to play to ensure optimal growth and smooth transition. With a creative and collective effort, the crypto mining industry can continue growing and revolutionizing the world.
With crypto mining giants such as Zionodes working on using renewable energy sources for their operations, the crypto world might transition sooner than expected. You can visit contact us to know more about this movement and perhaps, you'll find a way to do it yourself.