My impression is that most miners are located to take advantage of locales with very cheap hydroelectric/geothermal or take advantage of subsidized/overbuilt renewables. But I could be wrong. Any data on this?
We could design cryptocurrency systems that deliberately focus on using excess renewables, or just plain use less energy for mining. But the problem is that "Bitcoin" has come to stand in for "a cryptocurrency using the specific design choices that its inventor made more than a decade ago" and so privileging Bitcoin itself makes these choices impossible. The very best possible outcome is that (small-b) bitcoin tokens will eventually migrate to more efficient consensus networks, and the big-B Bitcoin network itself will be spun down to consume less power.
I would love to see a real example where you would proof me wrong.
Nonetheless, bitcoin itself is not necssary and it doesn't solve a problem.
People trust currencies. I trust currencies.
Bitcoin also has to have a trust system and right now it is connected to currencies. It is not decoupled. The only thing bitcoin is, its irradical and its basically gambling.
If a miner's power source is on the grid, it doesn't really matter all that much if they own a hydro plant, a solar plant, a coal plant, or are just buying power off the market. Either way, they are increasing the total energy consumption of the grid and their environmental footprint is determined by the grid average emissions and the amount of power the miner uses.
If they've built an off-grid renewable power station, you might argue it would otherwise not been built and is therefore relatively neutral, emission-wise. I think that argument would be wrong, because of the scale of large mining operations.
If you can build new renewable energy capacity at a competitive price and at sufficient scale to power a large mining operation, that's one thing and has nothing to do with whether or not you mine crypto with that energy. Deciding to not sell to the grid at that scale seems irrational, and honestly I doubt miners also operate power stations except maybe at a hobbyist level.
Could we? I thought Ethereum still had a pretty big digital/physical gap. In that there was no way to digitally ensure a physical truth (barring third party attestation).
Mining by it's nature has energy as its largest input cost, so it chases lower and more efficient sources of energy which are largely renewable energy
Further, good renewable sources are often poorly located for electricity distribution. You have situations where the power wouldn't otherwise be used, so it is being tapped into Bitcoin.
Iceland has a pretty much infinite supply of clean energy with geothermal. They're not interconnected to the grid so previously they would export that energy via aluminum, today they can export it with bitcoin and other processing (colo compute)
Georgia has also become a destination for bitcoin mining and it is largely hydro power
The reports on what bitcoin's proportion of renewable sources vary very widely from ~75%[0] and ~25%[1]
You can debate the methodologies of these estimates all day - but one thing to note is that the worst case estimates take an emissions factor which is average _for an entire country_ - while large scale mining operations (which account for the vast majority of mining) are often colocated in specific cheaper regions, usually around hydro/renewable power
The only X factor is that a lot of energy for bitcoin is sourced corruptly. The Chinese are already some way towards resolving that (they have an incentive to!) and shut down the heavily subsidized dirty mining that was happening[2]
My main takeaway is that the trends points to bitcoin eventually becoming a lot more efficient, and potentially can be used as a regulating mechanism on grids or as a way to export energy from renewable sources that aren't well interconnected
[0] https://coinshares.com/research/bitcoin-mining-network-decem...
[1] https://www.cell.com/joule/fulltext/S2542-4351(19)30255-7
[2] https://www.coindesk.com/bitmain-ebang-bitcoin-mining-energy...
Ok, but now somebody else is making that aluminum.
There's always something we could do with free energy, including making carbon-neutral liquid fuels or ammonia fertilizer, or taking CO2 out of the atmosphere.
If Bitcoin were the only way to have a working cryptocurrency, there'd at least be an argument for it. Now that proof-of-stake is available, Bitcoin's energy consumption is pure waste, since we can have essentially the same product without using the energy.
Oh, OK, I get it.
Region A consumes a lot of electricity smelting aluminium. Region B has cheap electricity so a smelting company moves there and ships the aluminium to region A. Region A now has one smelting company's worth of extra electricity available.
It's a little bit surprising to get such pushback on a genuine question when there are substances you could describe as "electricity you can put on the back of a truck" such as hydrogen canisters and various forms of battery!
As others have said, I was mostly referring not to the ability to easily convert to and from aluminium, but instead the fact aluminium is easily transportable and such a useful material that there is rarely surplus (if aluminium were cheaper, it would take over lots of places where steel is used, and even some uses of concrete).
That in effect means that if there is excess electricity in a region, it can in many cases work out cheaper to build a decent road to the region and build aluminium smelters than to build power transmission lines out of the region.
But then there is this: https://en.wikipedia.org/wiki/Aluminium%E2%80%93air_battery so who knows.
The electricity becomes available at its former location.
If you're going to flood a valley, please make it for something actually worthwile.
Depending on the place you pick you might not even need to flood too much
Its also not the responsibility of the world to create unlimited carbon neutral power source for bitcoin.
Bitcoin needs to solve a real issue worth solving, which it doesn't.
That Bitcoin didn't solve your problems doesn't mean it didn't solve real issues worth solving. Bitcoin solved the problem of quickly and cheaply moving money across the world without risking it will be lost. I was unable to move money between Africa and Europe before Bitcoin, now it's quick, cheap and reliable. Moving money between the USA and Europe also used to be problematic (took long and was expensive, at least it was reliable though), now with Bitcoin it's very easy.
Since Bitcoin uses waste electricity (you will immediately loose a lot of money mining with ordinary electricity), it doesn't make anything worse - of course as long as governments don't kick the balance away.
Right.
Not a single bitcoin miner in europe would use waste electricity;
China banned bitcoin mining due to grid issues;
So tell me again who has enough money to waste energy?
Bitcoin is balanced by the energy market otherwise it will deflate. IF its becoming worthless to do that job, bitcoin can't work, therefore it will always be cost effective somehow.
This still doesn't mean, that there is no better alternative.
'waste' energy means energy which you could not have used otherwise.
If it is cost effective to mine bitcoin in europe, then europe will just produce more energy for your usecase independently if it is useful to do so or not as long as it is cost effective.
This is not 'waste' energy; Its energy prodcued for your bitcoin mining.
Would the world be better of without bitcoin? Holy shit yes.
Do you know why farmers produce opium? Not because it is using waste farmland, because others are paying them more money for it then for food to consume. Its the same issue with bitcoin.
> Would the world be better of without bitcoin? Holy shit yes.
Don't speak for others. I never want to go back to world without Bitcoin. Sure, come up with something better, but no world would not be better off without it. Millions of people have better life thanks to it.
Your bitcoin miner don't have load control to make sure they consume the excess power. They just consume as much as possible.
And yes its still the same as opium farming; I can also give you annother example: when crops are used for biofuel, suddenly its financial better to produce energy instead of food. Happend in germany and other places.
I have NO IDEA why you would think that bitcoin mining is done by magical high intelligent controling systems. Haven't you seen any documentation on bitcoin mining operations at all?
I mined bitcoins myself a few years back at home as well.
https://www.primafelicitas.com/5-biggest-bitcoin-mining-farm... none of them did this for using 'waste' energy, they all did it for th emoney.
Missusing subsidised cheap electricity and now increasing competition for energy. And there have been enough stories on grid failers in china and regulators stopping those mining farms due to this.
"Millions of people have better life thanks to it." <<< this sentence is really weird. Are you talking about real people having a real benefit of bitcoin or are you talking about people getting rich of bitcoin by polluting our planet with unnecessary co2 and increased prices for others?
Key words being "few years back". I mined at home few years ago too - nowadays it's absolutely impossible.
You can find data easily yourself, simply check what wholesale electricity costs on the exchange right now, and check what you can earn with the most advanced mining hardware - you'll see that the earnings are three times lower than the cheapest electricity.
> I have NO IDEA why you would think that bitcoin mining is done by magical high intelligent controling systems
Because that's what you have to do if you want to have any profit from mining in 2021. It was different in 2017, I agree.
> this sentence is really weird. Are you talking about real people having a real benefit of bitcoin
Real benefit. Bitcoin makes it easy to transfer and store money where it was previously impossible.
> when crops are used for biofuel, suddenly its financial better to produce energy instead of food
Totally false, that never was and never will be profitable. It's only done because of EU subsidies (and these subsidies destroyed my country's landscape and food self-sufficiency).
It is a fact that bitcoin uses energy; There is no source of your claim of bitcoin using 'waste' energy.
You also assume that the 'waste' energy exists apparently in areas where they have fully isolated energy grids which would make it impossible for anyone else to use this energy better then bitcoin does; You ignore aluminum melting, data centers, normal households, heating etc. You ignore that energy subsidies exist to support people and are missused by bitcoin miners.
You claim bitcoin can store money, which it can do as efficiency as any other commodity out there: gold, shares, a normal bank account;
You claim bitcoin can be used to transfer money easily while ignoring that bitcoin itself has this benefit as every other exchange has; It is highly volatile, everything but userfriendly and is uncontrolled; We have a controlled money system not for the fun of it but because the rich people and unfair people tend to move money around uncontrolled; This costs you and me potentially money if tomorrow everyone would move to an anonymouse currency.
You can transfer money around the world by western union, paypal, amazon/google giftcards, gift cards, my credit card can buy in every currency; I have bought money from iran, usa, spain, japan without any issues.
And you ignore the basic fact, that bitcoin HAS TO BE MINED to be working. It HAS To BE distributed to be working. If only countries with cheap electricity are mining or a majority becomes real, it breaks; It breaks if someone is no longer motivated by earning enough bitcoins through mining as you can't do any transaction any more. The energy price of global economys is not connected to the energy price of bitcoin directly. People will pay the transaction fee as long as they want to be able to do anything with their bitcoins.
EU subsidies where not meant to motivate too many people to make energy out of crops; Thats the exact point i was making about subsidies and energy prices. How can you not see this?