Bitcoin! Even people who aren’t familiar with cryptocurrency or blockchain technology, both of which fundamentally powers “Bitcoin”, must have definitely heard about the term “Bitcoin” itself.
Since the launch of Bitcoin back in 2009, the value has shot from $0 (Nothing!) to over $60,000 as of currently. The Bitcoin Revolution has taken everybody by storm.
The huge increase in value itself is what generates curiosity about Bitcoin among the average people.
What is Bitcoin?
A simple Google search about “What is Bitcoin?” can give you literally thousands of articles trying to explain the same.
So, we aren’t going to bore you with the super-technical description.
To put it simply, Bitcoin is a decentralized cryptocurrency.
“Decentralized” means that unlike every other currency out there, the Bitcoin cryptocurrency isn’t issued, managed, or stored by any nation or government.
The term “Cryptocurrency” means that Bitcoin is a virtual/digital currency that is secured by utilizing the “cryptography” technology which makes it almost impossible to make duplicate transactions or counterfeit.
Each and every transaction that involves Bitcoin is stored in a public ledger by utilizing the “Blockchain” technology.
What is Bitcoin Mining?
“Bitcoin Mining” is a term that is as popular as Bitcoin itself.
So, what is Bitcoin mining?
No! Bitcoin Mining doesn’t involve axes or dirt.
Recalling the description about Bitcoin above, it is a virtual cryptocurrency that is not owned by anyone, is protected using cryptographic technology, and all transactions are logged in a public ledger.
All of these involve a lot of complex computational procedures.
Without anyone involved in controlling or monitoring the transactions and its validation of Bitcoin, how does the system work?
This is where Bitcoin mining comes into the picture.
Bitcoin mining is the procedure of utilizing computer power to process the transfers, transactions, etc. involving Bitcoin.
As a reward, Bitcoin miners receive Bitcoin for a set of computational tasks that they complete.
In earlier days, anyone with an ordinary PC setup could do Bitcoin mining.
However, as the number of Bitcoin transactions has increased in the years since its launch, Bitcoin miners now use dedicated “mining rigs” to perform Bitcoin mining tasks.
Is Bitcoin Mining Good for the Environment?
As Bitcoin mining now relies on powerful, electricity-hungry “mining rigs”, the energy requirement of conducting Bitcoin mining has also increased by a monstrous margin.
As per research data published by the Cambridge Centre for Alternative Finance, Bitcoin mining will require about 121.36 TWh (terawatt-hours) of electricity a year.
To put it into perspective, the electricity requirement is higher than even in several countries like Argentina, the Netherlands, and the UAE.
With companies like Tesla and other major corporations heavily supporting and investing in Bitcoin, the power necessary for Bitcoin mining is only expected to rise in the years to come.
How to Reduce Bitcoin Mining Electricity Requirements?
Undoubtedly, industry experts and enthusiasts are definitely not a fan of the environmental impact that Bitcoin mining creates.
Even though the energy requirements of Bitcoin mining isn’t expected to reduce anytime soon in the future, several ways can be implemented to increase the efficiency of the carbon footprint that is created.
For example, Cryptosolartech has implemented an initiative in Spain that utilizes solar and wind energy for Bitcoin mining.
Despite the immense shoot in valuation, Bitcoin or the blockchain/cryptocurrency technology, in general, hasn’t reached its full potential yet.
As time progress and further enhancements are made in the fields of blockchain and cryptocurrency, we can definitely stay positive about increasing the efficiency of conducting Bitcoin transactions.