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Power-Hungry Bitcoin And Other Cryptos Drained As Much Power With Mining As Whole Of Australia In 2023: Report

Published 06/02/2024, 13:32
Updated 06/02/2024, 14:40
© Reuters.  Power-Hungry Bitcoin And Other Cryptos Drained As Much Power With Mining As Whole Of Australia In 2023: Report

Benzinga - A recent report from the Energy Information Administration (EIA) revealed that in 2023, the global cryptocurrency mining industry consumed an amount of electricity comparable to Australia’s entire usage. The report also highlighted the industry’s significant growth in the United States, prompting the government to examine its energy consumption closely.

What Happened: The EIA’s report, released last week, disclosed that the energy consumed by cryptocurrency mining globally accounted for 0.2% to 0.9% of the world’s electricity demand, reported Business Insider on Tuesday. In the U.S., this figure ranges from 0.6% to 2.3% of the nation’s electricity demand, equivalent to the usage of a state like Utah or West Virginia.

Cryptocurrency mining involves solving intricate cryptographic puzzles to add new tokens to the blockchain, a process that requires substantial computing power and, consequently, a large amount of electricity.

See Also: Dogecoin Outperforming ‘Killers:’ Why Elon Musk Speculation Could Fuel Volatility

While the energy-intensive nature of the crypto industry has been known for some time, the EIA report highlighted growing concerns about the industry’s impact on the U.S. electric power sector, including potential strains on the electricity grid, increased electricity prices, and effects on carbon dioxide emissions.

The report also noted a significant increase in the share of Bitcoin mining taking place in the U.S., rising from 3.4% in January 2020 to 37.8% in January 2022. This growth has prompted the US government to take a closer look at the industry’s energy usage, as evidenced by the recent approval of an emergency request from the EIA to collect data from commercial crypto miners.

Why It Matters: The report underscores the increasing concerns over the environmental impact of cryptocurrency mining, a topic that has been a subject of debate within the industry. The EIA’s findings add weight to the argument that the industry’s energy consumption could have significant consequences for the environment and the energy sector.

On the other hand, the report also highlights the rapid growth of the U.S. as a key player in the global crypto-mining industry. This growth could have significant implications for the US energy sector and may prompt further discussions about the transition to sustainable energy sources for crypto mining. It could also impact the global distribution of crypto mining operations, as seen in the shift of some operations to Russia due to its energy surplus.

Read Next: ‘Yes This Is Real’: Videos Of Wall Street Bull ‘Wif Hat’ Go Viral, ‘Dogecoin Killer’ $WIF Up 17%

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