Why does the delving of cryptocurrencies cost so much energy? Are cryptocurrencies justifiable in times of climate change?

Thanks for these two questions.

It looks like you’re throwing all the crypto coins on one heap.

Bitcoin is the first and most famous.That it takes so much energy to obtain a few of these coins is because ‘ proof of Work ‘ is used to prove that the computers participating in the network are actually individual computers, and not one computer That spends for several.

The idea behind this distributed network is that transactions can take place without trust: there is no need for a central organisation.

That this works for Bitcoin does not mean that this also applies to other cryptocurrencies.Some, like e.g. Ripple are owned by a central organization. These coins are created by the company itself according to the need for such digital tokens.

Other projects retain the decentralized character, but experiment with digital proof methods that consume less energy.

This is a relatively new technology and you can expect a number of efficiency battles to be made in the future.

The fact that the minting of coins costs energy does not have to be so bad, as long as it is CO2 neutral with the help of renewable energy sources.Computers that use e.g. in Iceland hydropower plants are in that in itself better than those same computers that consume electricity in China generated by coal-fired power stations.

There are important advantages to using cryptocurrencies, even those that are centrally managed.Currently, a lot more power is being consumed by financial institutions than all the crypto coins together worldwide. Many of these datacenters and offices with air conditioning or heating will become redundant once decentralised transaction processing is started.

Mining (Delven) of crypto coins costs a lot of energy.There has to be a lot of computer power to do to delving a bitcoin. Electricity is needed for computer power and these energy costs are sometimes greater than the delving of physical raw materials such as gold.

In the delving of cryptocurrencies, the network of computers monitors all transactions of this crypto currencies.The computers monitor and multiply the blockchain by solving intricate puzzles. As a reward for solving these calculations, the computer owner gets crypto coins and/or transaction fees. The more computer and computing power You bet the more you earn. Solving the puzzles is also becoming heavier and harder and requires more computing power.

Reliable research has shown that the mining of 1 Bitcoin now costs almost 20 mega joules per dollar.This is more than 3 x as much as the delving of copper or gold.

In my view, it is certainly not justifiable to mine a digital currency that has so much impact on our lives and the people who are still born.But this is just as good for flying, eating meat and lying under the tanning bed.

I think not.Cryptocurrency may be banned as far as I am concerned. Only the criminal has a very real thing.

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