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Originally Posted by PurpleCabbage
I remember vividly we had just finished a full energy efficiency installation at a remote data center some high volume of LED lights & adjustable valves on condenser pumps were installed to essentially revamp our power usage at a 20,000sqf facility, a smaller center for Seattle.
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That's wild. It's a quality post, and therefore an internet rarity.
The currency needs A LOT of electricity to drive the mines which create the blocks - a LOOOOTTT!.
It is extremely inefficient on face value, but I think less energy is used to mint 10K of Bitcoin than energy used to produce 10K in Gold.
For a miner, expenses are the cost of electricity, space leasing and depreciation of hardware. The mining machines produce a ton of heat and make a lot of noise.
If the price of a coin falls too low the mines run at a short term loss (I think it's somewhere like 12-15K per coin break even, not sure) Everytime there is a 'Halvening' (when the rate of supply is halved) it becomes more expensive to mine a coin.
This leads to a major problem because as the reward in coins for mining becomes less viable, miners increasingly rely on transaction fees. When issuance of new coins ceases at 21M coins, miners will be reliant on transaction fees alone, which will make using the coins for smaller transactions prohibitively expensive.
Hence, I do not see Bitcoin as energy efficient, nor as sustainable asset in its current form, because it requires increasing amounts of energy over time to mine. As mining becomes impossibly expensive, and terminates in the future, miners' bitcoin rewards will have to be made up for in transactions to keep the currency afloat.
It all relies on the coins becoming extremely valuable, and ultimately, a high velocity of transactions.