The U.S. Energy Information Administration (EIA), a statistics agency of the U.S. Energy Department, has sent letters to cryptocurrency miners requiring data related to energy consumption and configuration of their mining sites. According to one of the letters posted on social media, miners have until February 23 to report the info regarding the activities carried […]
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Crypto, AI and Data Centers Could Double Energy Consumption in 2026
The aggregated demand for energy from crypto, artificial intelligence (AI), and traditional data centers could double in 2026. According to a report by the International Energy Agency (IEA), the consumption growth might mean adding a country like Sweden (in the best case) or Germany (in the worst case) to the global energy demand.
Crypto, AI, and Traditional Data Centers to Add Significantly to 2026’s Global Energy Demand
According to a recent report by the International Energy Agency (IEA), an international organization created in 1974 to secure the energy reliance of its members, it is predicted that the energy consumption of traditional data centers, artificial intelligence (AI), and crypto might double by 2026.
The IEA stresses that data centers are a critical part of today’s digitalization, supporting all kinds of online operations, with 40% of the electricity demand of these centers coming from computing tasks and another 40% from cooling the devices where this computing takes place.
This industry’s demand for these computing tasks was 460 TWh in 2022, 2% of the global energy consumption. This is expected to increase to 620-1,050 TWh in 2026, signifying that it would add the demand of a country like Sweden, at the most conservative prediction, or one like Germany, at the worst estimation, to the global energy consumption.
Cryptocurrencies alone accounted for a demand of 110 TWh in 2022 and are expected to rise by more than 40% to 160 TWh by 2026. Nonetheless, the report recognizes that “uncertainties remain for the pace of acceleration in cryptocurrency adoption and technology efficiency improvements,” mentioning Ethereum’s consensus mechanism change from proof-of-work (POW) to proof-of-stake (POW), which made it reduce its energy footprint by 99%.
In contrast, Bitcoin energy consumption ranged at 120 TWh in 2023, more than 90% of the total 130 TWh estimated to be consumed by the whole crypto sector that year.
“Challenges in reducing electricity consumption remain, as energy savings can be offset by increases in other energy-consuming operations, such as other cryptocurrencies, even as some become more efficient,” the IEA concluded.
What do you think about the predicted energy consumption increase of crypto, AI, and data centers by 2026? Tell us in the comments section below.
The Secret Victory: How Bitcoin Flipped The Energy Consumption Narrative
The debate surrounding the Bitcoin network’s energy consumption has been intense and mostly tilted in favor of BTC detractors. These individuals and entities have used the Cambridge Bitcoin Electricity Consumption Index (CBECI) to make an argument against the cryptocurrency.
However, Cambridge has updated its CBECI to reflect new data, potentially flipping the discourse around Bitcoin’s sustainability. This report previously compared BTC’s energy consumption to some major European nations, but the revised models provide a deeper insight.
Bitcoin Mining Data Evolves, Models Should Follow
In an article called “Bitcoin Electricity Consumption: An Improved Assessment,” the institution provided the motivations behind the update. In addition, Cambridge acknowledged the difficulties in creating a methodology and getting the data due to BTC’s decentralized network.
Moreover, the institution received expert feedback and evaluated energy consumption as just one of many items to create an accurate index. Cambridge has been working on this issue since July 2019 and launching other tools besides the CBECI to help track Bitcoin’s energy consumption, hashrate distribution, and greenhouse (GHG) emissions.
The revised model uses data from BTC mining hardware manufacturers, governments, and other sources. This data affected estimations by looking into the distribution of newer mining equipment and the different energy sources leveraged by this nascent industry.
The institution clarified:
(…) the backbone of our previous CBECI methodology was the assumption that every profitable hardware model released less than 5 years ago equally fuelled the total network hashrate. This, however, led to a disproportionally large number of older devices compared to newer ones in our assumed hardware distribution during exceptionally profitable mining periods.
The chart below shows the new model’s discrepancies with the 2019 CBECI. In particular, the model differed from the 2021 model, when the Bitcoin price rallied, and mining profitability was high.
Energy consumption at that time stood at 89 Terawatt per hour (TWh), according to the revised CBECI model. The old model showed a much higher figure at 104 TWh. The report stated:
In terms of global electricity consumption, it represented about 0.38%. As for 2023, the year-to-date electricity consumption estimate has been revised from 75.7 TWh to 70.4 TWh.
A Look Into The Future
Cambridge expressed its desire to continue informing the public about Bitcoin’s energy consumption. However, the institution called the process “elusive” and committed to only providing approximated numbers on the nascent BTC mining sector.
The report acknowledged the advantages of using Bitcoin mining to offset carbon emissions via different methods and its impact on noise disturbances, water use, and thermal pollution.
This report is one of the many that have emerged over the past three months. Major consultancy company KPMG highlighted the benefits of using the cryptocurrency to push energy demand into its next era and generally attempted to tear down the myths surrounding the industry.
KPMG and Cambridge’s efforts have been celebrated across the crypto industry. Daniel Batten, an investors in transparent and sustainable energy, stated:
Cambridge have just updated their Bitcoin power/energy consumption methodology. First glance: it’s decreased around 25% and is now looking much more accurate (…).
Cover image from Unsplash, chart from Tradingview, and Cambridge
Bitcoin, Ethereum Technical Analysis: BTC Nears $27,000 as Market Reacts to Latest US Personal Consumption Data
Bitcoin moved closer to the ,000 level on Saturday, as markets continued to react to the latest Personal Consumption data from the United States. The key inflation index rose to 4.4% in April, higher than expectations of a drop to 3.9%. Ethereum also edged higher.
Bitcoin
Bitcoin (BTC) rallied towards ,000 to start the weekend, as prices reacted to the latest Personal Consumption data in the United States.
BTC/USD climbed to a peak of ,916.67 earlier in today’s session, which came a day after trading at a low of ,370.55.
The move sees bitcoin climb for a third straight session, moving past a floor at ,3000 in the process.
From the chart, the latest surge in price came as the 14-day relative strength index (RSI) bounced from a support point at 39.00.
At the time of writing this, the index is now tracking at 43.02, with the next visible point of resistance at 45.00.
Should this point be broken, then there is a strong possibility that BTC will move back over the ,000 level.
Ethereum
In addition to BTC, ethereum (ETH) also moved higher on Saturday, remaining above the ,800 level.
Following a low of ,810.37 on Friday, ETH/USD managed to hit an intraday high of ,837.87 earlier in the day.
This surge led to the world’s second-largest cryptocurrency breaking out of its recent ceiling of ,830.
However, as the day has progressed, earlier gains have somewhat fallen, with ETH now trading at ,828.18.
It appears that market uncertainty has also risen, as the RSI neared a ceiling of its own at the 49.00 mark.
Price strength is now tracking at 48.75, and should it break out of this point, then there could be further highs from ETH this weekend.
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Do you expect ETH to move above ,900 this weekend? Leave your thoughts in the comments below.
Kazakhstan Law Limiting Crypto Miners’ Consumption of Electricity Enters Into Force
A new law expanding the regulatory framework for cryptocurrency miners while restricting their access to low-cost electricity has entered into force in Kazakhstan. The legislation introduces a licensing regime for mining with two different categories of licenses that companies will have to renew periodically.
President Tokayev Sings Law Regulating Crypto Assets Mining and Exchange in Kazakhstan
The law “On Digital Assets in the Republic of Kazakhstan,” signed by President Kassym-Jomart Tokayev on Monday, has come into force. The main purpose of the new legislation, approved together with amendments to other legal acts like the Tax Code, is to regulate activities related to the issuance and circulation of these assets, most notably mining.
The changes are also aimed at creating conditions for the development of the crypto industry and fair competition between market participants, local media reported. The digital asset law, which was adopted by the parliament in late January, defines the powers of state bodies that oversee the sector and introduces licensing for crypto miners and exchanges, replacing the current registration system.
Mining licenses will be issued for a period of three years to two groups of applicants. Entities that own mining infrastructure, such as data centers meeting certain standards in terms of equipment, location, and security, fall under the first category. The second is for those that own mining hardware but rent space in crypto farms and do not apply for an energy quota directly.
A separate set of requirements has been introduced for mining pools. They must have their hardware and software installed in Kazakhstan and comply with the country’s information security rules and other applicable regulations.
Furthermore, crypto miners will be allowed to purchase electricity from the national grid only if there is a surplus and exclusively from the government-controlled, centralized exchange KOREM. However, price caps for this energy will be removed and the trading will be carried out based on market principles.
Cheap, subsidized power was one of the factors that attracted mining companies to Kazakhstan following China’s crackdown on the industry in 2021. The authorities in the Central Asian nation have blamed the growing electricity deficit on the influx of miners and taken steps to restrict consumption in the sector, including temporarily disconnecting registered facilities and shutting down illegal farms. On Jan. 1, a higher electricity surcharge was imposed on authorized miners.
Do you think the stricter regulations and increased costs threaten Kazakhstan’s status as a mining destination? Share your thoughts on the subject in the comments section below.
Polkadot Electricity Consumption Is Less Than Solana, Bitcoin, And Ethereum
Electricity consumption has been one of the major concerns with the advent of cryptocurrencies especially Polkadot. Though with models running with the Proof-of-Stake (PoS) consensus mechanism, this electricity use seems to be minimal since their process for transaction validations is staking. But the story is not the same for those running with Proof-of-Work (PoW) such as Bitcoin.
Mining is the associated process through which the PoW models could validate their network transactions. However, the process consumes lots of electricity as it uses highly computational equipment to solve cryptographic puzzles.
DOT sits at Source: DOTUSD on TradingView.com
This high energy consumption led to several crackdowns on crypto mining in different countries, especially Bitcoin, in 2021. The move was in line with the argument that such practices facilitate environmental pollution.
This concern on energy consumption propelled the Crypto Carbon Ratings Institute (CCRI) to research the rate of electricity consumption by some blockchains. CCRI studied some networks like Solana, Bitcoin, Ethereum, and Polkadot in its research.
Related Reading | Lessons From Reason’s “The Fake Environmentalist Attack on Bitcoin” Mini-Doc
Based on the results from CCRI research, Polkadot, the strong competitor of Ethereum, emerged as the network with the least electricity consumption compared with Ethereum, Solana, Bitcoin, and other top cryptocurrencies.
This indicates that Polkadot minimally impacts environmental and climatic changes and pollution more than the other networks. According to the CCRI rating, Polkadot’s energy consumption is 6.6 times the annual value of electricity used by an average U.S. family.
A blockchain’s electricity consumption stands as a high determinant factor of its capital inflow from institutional investors. This formed Tesla’s 2021 move against Bitcoin as the electric car company suspended BTC as one of its payment options. The car giant cited BTC mining’s environmental impact as totally unacceptable.
Among all the networks involved in the research, Bitcoin shows the highest energy consumption. Next in the line are Ethereum, Solana, Cardano, Algorand, Avalanche, and Tezos.
Polkadot Announces Pioneers Prize Program
Polkadot has announced its Pioneers Prize Program in a recent move for more technological innovation within its ecosystem. This program is packed with million rewards. The picking of winners will be through a series of challenges and some set prizes. It’s part of the network’s plan to facilitate the growth of its ecosystem and Web3.
The field and general outlook of the network have put DOT on a bullish trend for investors. The contributory influences are coming from Polkadot’s rating of low electricity consumption and its Pioneers Prize Program.
Related Reading | Bitcoin On-Chain Demands Suggests That The Market Has Reached Its Bottom
From analysts’ evaluation of the Polkadot price trend, the protocol has rounded off both its retest and breakout. Most of them think that the DOT has moved to its buy zone.
Featured image from Pixabay, chart from TradingView.com
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Green Policy and Crypto Energy Consumption in the EU
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Bitcoin Price Forming Descending Triangle, Market Showing Consumption of Demand
As Bitcoin price struggles to maintain strength above ,000 but is unable to push below ,200, the crypto asset’s price chart has formed what appears to be a descending triangle – a bearish continuation pattern, that does have potential to break to the upside.
The formation shows many similarities to a descending triangle that formed during the 2018 bear market, that eventually sent Bitcoin plummeting to its bottom around ,200. One analyst believes that although the market is showing demand for Bitcoin, that demand is being consumed ferociously and once that demand begins to fizzle, the selling pressure may finally get the best of bulls buying the dip.
Bitcoin Price Forms Descending Triangle, Target is ,500, But ,000 is Possible
Bitcoin price has stagnated in recent days, unable to choose a clear direction. The leading crypto asset has been locked in an increasingly tightening range and has not had the bullish momentum to break above ,200, yet bearish sell pressure hasn’t been enough to break below ,200. The bouncing back and forth between peaks and troughs has caused Bitcoin price to form a descending triangle, a chart pattern that could have a target of ,500 if confirmed.
Related Reading | Bitcoin Price Rejected From K, Or the Start of a Bullish Reversal?
Crypto analyst Dave the Wave – known for his long-term trend analysis using moving averages, the MACD, and most importantly an emphasis on Bitcoin’s logarithmic growth curve – is long-term bullish on Bitcoin, but in the “medium-term” expects Bitcoin price to fall out of the descending triangle formation to around ,500 where a bounce could happen.
The dreaded descending triangle…. pic.twitter.com/CxSpgXTMJw
— dave the wave (@davthewave) July 31, 2019
In the past, the analyst perfectly called a bounce off the 200-week moving average. Here he expects the bounce at ,500 to be nothing more than that – a bounce. After that, another “further drop at a later date” could bring the entire correction total to 50%, or as much as 61%.
The analyst advocates averaging in around the 50% point being a wise strategy. A total 61.8% drop – a common Fibonacci retracement level – would take Bitcoin price to ,200 as the final bottom. A 50% drop from the rally high of ,800 would be ,900. Neither drop would put Bitcoin’s previous bear market bottom in jeopardy.
Analyst: Supply Consuming BTC Demand, What Happens If Demand Runs Out?
Adding further credence to the descending triangle playing out similarly to the formation that occurred during the 2018 bear market that caused Bitcoin price to break below what was believed to be the bottom at the time at ,000, falling to its eventual bottom at ,200.
My current higher timeframe view on Bitcoin pic.twitter.com/llqhNi8a1j
— Mr. TA (@Trader_M4tt) August 1, 2019
Another analyst, says that although Bitcoin has bounced off the “daily demand” it has done so “ not very convincingly” and current price action appears to be “consumption of demand.” The analysts compares the current price action consuming the demand to the same price action around ,000 – also where that demand eventually ran out in 2018, causing Bitcoin to experience a massive drop.
Should that demand be overcome by supply, the same scenario could play out. However, that ,000 price level is now acting as support once again, and is likely to stay that way indefinitely.
The post Bitcoin Price Forming Descending Triangle, Market Showing Consumption of Demand appeared first on NewsBTC.
Missoula County Eyes New Zoning Regs to Address Crypto Mining Power Consumption
The post Missoula County Eyes New Zoning Regs to Address Crypto Mining Power Consumption appeared first on DCEBrief.
Bitcoin’s Energy Consumption Equalled That of Hungary in 2018
Bitcoin miners consumed as much as energy in 2018 as Hungary, according to Alex de Vries.
The researcher at the Netherlands’ PricewaterhouseCoopers (PwC) branch studied bitcoin’s global energy consumption all across the year. He found that existing hydropower projects were not sufficient in sustaining the cryptocurrency mining operations, adding that the bitcoin network demanded as much as 62.3 TWh power. The power of such scale could single-handedly serve a Hungary or a Switzerland.
More than Banks
The revelation followed years of debates about whether or not bitcoin is anti-environment. Skeptics criticize the decentralized financial network for contributing to global warming because each node in the system requires electricity to sustain itself. That is how machines process mathematical problems – by injecting vast computing power – that eventually mine and confirm bitcoin transactions on the network. As a result, the entire mining operation generates heat, as well as increase power demand supplied by fossil power plants.
On the other hand, supports argue that banks, which bitcoin aims to replace, consume far more resources with a massive carbon footprint. Per them, banks issue paper cash using environmental-unfriendly chemicals, consume power with their location-bound local offices and server warehouses, and allow their employees to travel using gas-inefficient armored cars, etc.
But De Vries belongs to the skeptics’ lot. In his journal, the blockchain researcher wrote that bitcoin miners were consuming 12,000 times more resources than the maximum carbon footprint of transactions processed by the banking industry. He also said that bitcoin supporters switched to renewable energy, but that didn’t correctly solve the issue.
Bitcoin Can Never Be Green
21/ #Bitcoin’s utilization of the electrical capacity consumes magnitudes less electricity than existing fiat systems which not only have power requirements banking infrastructure, but the military and political machina. The energy tradeoff is a “net positive” outcome. pic.twitter.com/uB2bnx9IKI
— Dan Hedl (@danheld) September 14, 2018
De Vries said that bitcoin mining operations would constantly demand energy even if they switch from fossil to renewable energy. The researcher cited the hydropower plans in China’s Sichuan province, which were generating three times more power during the wet summer months than during the dry winter season. These plants used coal-based energy to meet the miners’ demand, given the cryptocurrency mining operations were not designed to shut down before they generate profits.
“Based on these findings, the renewable energy currently used in bitcoin mining cannot be considered ‘green’, and this challenge of combining a constant energy requirement with a variable production of renewables will always exist,” says de Vries. “It could even provide an incentive for the construction of new coal-fired power plants to meet the higher base demand.”
Studies Fundamentally Flawed
Eric Masanet, an energy modeling scholar at Northwestern University, said that a majority of Bitcoin/global warming studies had severe fundamental flaws. He claimed that the global electric power sector was taking massive steps towards decarbonization. Masanet believed that a policy-driven decrease in fossil power supply would eventually lead the bitcoin mining rigs to rely on green electricity – and other scholars shouldn’t ignore these facts. Excerpts from his statement:
“It appears the authors have overlooked these trends in their projections, while simultaneously insisting on tremendous growth in cryptocurrency adoption, resulting in inflated and dubious estimates of future carbon emissions.”
The post Bitcoin’s Energy Consumption Equalled That of Hungary in 2018 appeared first on NewsBTC.