Cryptocurrency mining, a real energy gulf, banned this winter in Europe?

Cryptocurrency miners could be without power this winter in Europe. The reason: their activity consumes too much energy.

Cryptocurrencies, these virtual and decentralized currencies, whose course and history are studded with successes and setbacks, are on the rise. The proliferation of Bitcoin or Ethereum, among others, could however be slowed down this winter because of the energy crisis.

In case of difficulty of supply, Europe could cut the electricity to the computers of ‘miners’. These people perform a lot of very complex computer calculations that are essential to validating transactions that are useful to blockchain technology and its underlying, cryptocurrency.

These calculations cannot be solved with a ‘simple’ personal computer. The computer must be very powerful and therefore quite energy-intensive. Often, mining is carried out using several computers that are gathered in what is called a mining farm.

What is cryptocurrency mining?

As explained on the website of Futura Science, mining consists, by testing an enormous number of combinations, of what figure could generate the “hash” of a given transaction. The first miner who finds the solution provides a “proof of work” (Proof of Work) who certifies that he was the first to find the solution to the problem. He collects a commission – a small percentage of the transaction he has validated and also, regularly, new Bitcoins. This is where the analogy with traditional currency mining comes from, since this work regularly results in the creation of new BTC.

With a powerful computer, energy consumption is multiplied. Such a computer consumes not far from 30,000 kWh/year. By way of comparison, a freezer uses between 200 and 500 kWh/year, specifies the RTBF site. In 5 years, the energy consumption linked to cryptocurrencies has increased by 900%. It’s today 0.4% of electricity consumption worldwide.

Towards a ban on mining?

The European Commission has issued its recommendations regarding cryptocurrency mining this winter. In its plan to digitize the energy sector published on October 18, she is worried about the situation in the context of the energy crisis. It requires states to implement ambitious and targeted measures to reduce the consumption of cryptocurrency players. It even provides, in the event of the need for load shedding of the electrical systems to force the mining of virtual currencies to cease.

As the RTBF website explains, there is, in fact, little mining activity on European soil. The countries concerned are mainly the Scandinavian countries, a little Ireland, and especially Germany.

In the USA, the White House, also proposed to ban bitcoin mining in a recent report, on the grounds that it represents a risk and a threat to the country’s electricity production. The country has very high capacity mining farms.

Last March, The world published an impressive report on Whinstone’s largest bitcoin mining farm, located in Rockdale, a rural city in the heart of Texas. In a building 300 meters long, 38,300 computers and hundreds of servers running at full speed day and night for “undermine“. To operate and cool these thousands of battery-installed devices, electrical power equal to 700 megawatts is needed, that is approximately the energy produced by half a nuclear reactorexplains the French newspaper.

Towards more digital sobriety

In the future, the challenge of virtual currencies will be to move towards more energy sobriety. Some changes concrete already exist. As explained The gallery, recently, the Ethereum blockchain (and its extension in cryptocurrency: ether) changed its transaction validation system abandoning the so-called method of “proof of work” to another, much less energy-intensive, called “proof of stake“.

Concretely, details the French daily, “if the first is compete with thousands of validators (miners) who simultaneously use the computing power of their computers to each try to solve the first of the cryptographic equations, the second method is much less energy intensive since it is based on a draw of voluntary minors who undertake to carry out a work requested”.

The advantage of this protocol is that it avoids thousands of cryptocurrency miners working at the same time on the same transaction and wasting energy. According to an estimate by the Ethereum Foundation, this protocol change could reduce the energy consumption of the blockchain by… 99.95%.

This threat of a ban on mining in Europe brings a more general reflection on a more reasoned use of new technologies in the alarmist context of global warming. This digital sobriety involves, among other things, lower data storage, the use of wifi instead of 4G (23 times less energy-consuming), watching a film in low rather than high definition,… detailed The gallery.

Cryptocurrencies, these virtual and decentralized currencies, whose course and history are studded with successes and setbacks, are on the rise. The proliferation of Bitcoin or Ethereum, among others, could however be slowed down this winter because of the energy crisis. In the event of difficulty in supply, Europe could cut off the electricity to the computers of the ‘miners’. These people perform a lot of very complex computer calculations that are essential to validating transactions that are useful to blockchain technology and its underlying, cryptocurrency. These calculations cannot be solved with a ‘simple’ personal computer. The computer must be very powerful and therefore quite energy-intensive. Often, mining is carried out using several computers which are brought together in what is called a mining farm. With a powerful computer, energy consumption is multiplied. Such a computer consumes close to 30,000 kWh/year. By way of comparison, a freezer uses between 200 and 500 kWh/year, specifies the RTBF site. In 5 years, the energy consumption linked to cryptocurrencies has increased by 900%. Today it is 0.4% of electricity consumption worldwide. The European Commission has issued its recommendations regarding cryptocurrency mining this winter. In its plan to digitize the energy sector published on October 18, it is concerned about the situation in the context of the energy crisis. It demands that states implement ambitious and targeted measures to reduce the consumption of cryptocurrency players. It even provides, in the event of the need for load shedding of electrical systems, to force the mining of virtual currencies to stop. As the RTBF website explains, there is, in fact, little mining activity on European soil. The countries concerned are mainly the Scandinavian countries, a little Ireland, and especially Germany. In the United States, the White House also proposed to ban bitcoin mining in a recent report, on the grounds that it represents a risk and a threat to the country’s electricity production. The country has very high capacity mining farms. Last March, Le Monde published an impressive report on Whinstone’s largest bitcoin mining farm, located in Rockdale, a rural town in the heart of Texas. In a building 300 meters long, 38,300 computers and hundreds of servers are running at full speed day and night to “mine”. To operate and cool these thousands of devices installed in battery, an electrical power equal to 700 megawatts is necessary, that is to say approximately the energy produced by a half-nuclear reactor, explains the French newspaper. In the future, the challenge of virtual currencies will be to move towards more energy sobriety. Some concrete changes already exist. As La Tribune explains, recently, the Ethereum blockchain (and its cryptocurrency extension: ether) switched its transaction validation system by abandoning the so-called “proof of work” method to another, much less greedy in energy, called “proof of stake”. Concretely, details the French daily, “if the first consists in putting in competition thousands of validators (miners) who simultaneously use the computing power of their computers to, each, try to solve the first of the cryptographic equations, the second method s proves to be much less energy-intensive since it is based on a draw of voluntary miners who undertake to carry out the work requested”. The advantage of this protocol is that it avoids thousands of cryptocurrency miners working at the same time on the same transaction and waste energy. According to an estimate by the Ethereum Foundation, this protocol change could reduce the energy consumption of the blockchain by… 99.95%. This threat of banning mining in Europe leads to a more general reflection on a more reasoned use of new technologies in the alarmist context of global warming. This digital sobriety involves, among other things, lower data storage, the use of wifi instead of 4G (23 times less energy-consuming), watching a film in low rather than high definition,… details La Tribune.

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Cryptocurrency mining, a real energy gulf, banned this winter in Europe?


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