Cryptocurrencies True Cost

The developers of cryptocurrencies are working on reducing the huge energy consumption required for mining. ConsenSys, a blockchain software outfit, reckons it has developed a solution to reduce the energy requirements of ethereum to close to zero. It could give the currency an edge over bitcoin.

Morgan Stanley said in a recent note to clients, that Bitcoin mining took more electricity in 2018 than the entire country of Argentina. It added that is expected consumption to be greater this year than that for electric vehicles in 2025.

The bank said;

“Bitcoin demand may represent a new business opportunity for renewable energy developers.”

It’s still not clear, whether the renewable energy firms want to serve miners. Canada has become one country of choice for those with bitcoin operations but local powerco Hydro-Québec said last week it is thinking of raising its rates for cryptocurrency mining firms.

The company says it has concerns about the size of some of the proposed projects which could lead to capacity issues. Some experts think, that green crypto is not on the horizon.

Cryptocurrency and blockchain lead at the Cambridge Centre for Alternative Finance Michel Rauchs says;

“The current mining process is indeed resource-intensive and wasteful, but there is no magic fix in sight. Many would argue that it’s precisely the useless nature of cryptocurrency mining that keeps the system secure.”

He also added, that cryptocurrency mining comes at a cost in the form of custom hardware and electricity consumption.