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Mining Bitcoins takes power, but is it an “environmental disaster?”

Original author: 
Nate Anderson

Bitcoin mining takes a lot of computing power—so naturally someone created a piece of malware to mine on other people's computers.

Kaspersky Lab

Mark Gimein is something of a Bitcoin skeptic, but in addition to his concerns about Bitcoin not being a "real currency," he's now charging that it has created "a real-world environmental disaster."

Writing in Bloomberg News, Gimein notes that mining Bitcoins—performing the computationally expensive calculations needed to define new Bitcoins—uses power. A lot of power. (Read our 2011 Bitcoin primer for more details.) He writes:

About 982 megawatt hours a day, to be exact. That’s enough to power roughly 31,000 US homes, or about half a Large Hadron Collider. If the dreams of Bitcoin proponents are realized, and the currency is adopted for widespread commerce, the power demands of bitcoin mines would rise dramatically.

If that makes you think of the vast efforts devoted to the mining of precious metals in the centuries of gold- and silver-based economies, it should. One of the strangest aspects of the Bitcoin frenzy is that the Bitcoin economy replicates some of the most archaic features of the gold standard. Real-world mining of precious metals for currency was a resource-hungry and value-destroying process. Bitcoin mining is too.

Gimein draws on the stats provided by Bitcoin-focused site The numbers fluctuate a bit with each day of calculations being tracked. According to Blockchain's stats this weekend, the last 24 hours of worldwide mining activity burned through 928.24 megawatt hours of power while miners calculated 59,502.6 gigahashes per second. Total power bill: $139,236.07.

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