<p>Of course. At the current block reward of 25 BTC per block, on average 3600 BTC are mined per day which are worth over $1 million.</p>

<p>If it were significantly much cheaper than $1M (in terms of energy costs) to mine that $1M worth of coins, more people would do so, thus the difficulty would go up, thus the energy costs would go up.</p>

<p>By definition, the energy costs to mine x amount of bitcoins will never be significantly less than the actual worth of those bitcoins.</p>

<p>By the way, "wasting" (well, not really) only $365M per year is an incredible efficient improvement over the current banking system worldwide. The huge costs, waste of resources, and TONS of other collateral damage that come with the fiat currency infrastructure is astronomical, and saying that it's much, <em>MUCH</em> more than the costs of Bitcoin is even still an understatement.</p>

CC BY-SA 3.0
2014-11-02T22:24:51.510Z
The asker never used the word waste.
Nick ODell
CC BY-SA 3.0
2014-11-02T22:27:23.743Z
You could improve your comparison with fiat by showing how much they (e.g. US dollar or Euro) spend every year.
Arturo Torres Sánchez
CC BY-SA 3.0
2014-11-03T13:33:36.227Z
That's the thing, if it's 1 million a day that's $14 per transaction (around 70.000 yesterday) which I think is comparably high (if not higher) than the cost of processing transactions in traditional banking systems. Hence i suppose that Bitcoin can only maintain its currently very appealing low transaction cost so long as miners can make a profit without charging transaction fees, which might eventually be just as high (if not higher, since miners compete which means resources are wasted) as those currently charged by banks.
Sebastian Kovats
CC BY-SA 3.0
2014-11-03T17:11:54.097Z
Sebastian, you are absolutely right! The cost of supporting transactions in bitcoin is much more higher, than in centralized systems. Bitcoin is alive now only because it is ponzi.
amaclin
CC BY-SA 3.0
2014-11-04T11:54:10.467Z
Sebastian Kovats, your logic is reversed. If it's no longer profitable for miners, some will quit, and mining will become cheaper, rather than tx fees going up. The mining profit (block reward) vs costs (energy consumption) will always remain in a dynamic equilibrium. And @amaclin You better put your trust in fiat currencies then :)
RocketNuts
CC BY-SA 3.0
2014-11-04T17:36:11.893Z
That's true but if mining becomes cheaper because some miners quit, it follows that the value of bitcoins will not be justified anymore if it doesn't decline. I realise that neither fiat currencies are backed and limited since the gold standard was left, but they have powerful GOVERNMENTS behind them. What's behind Bitcoin if not miners' effort ?
Sebastian Kovats
CC BY-SA 3.0
2014-11-05T07:13:07.847Z
Fiat has powerful governments, Bitcoin has powerful cryptography, transparency, lack of limitations or need for trust. I consider mathematical laws stronger than goverments laws.
Maǳi Koǌo
CC BY-SA 3.0
2014-11-05T20:18:28.537Z
About that trust thing, Bitcoin doesn't require less trust. If you buy something with a cfedit card you have a chance of getting back your money if you're ripped off (chargeback). Since Bitcoin transactions are irreversible, you need to trust the person you're sending to even more. Thus trust isn't made obsolete, it's just moved to another instance.
Sebastian Kovats
CC BY-SA 3.0
2014-11-05T23:51:13.800Z
@sebastian multi signature transactions since this in a fundamentally better way than credit cards. Exactly because bitcoin is such a stable foundation, better solutions are being built on top of it. As for the  electricity cost: that's to maintain the network, not for a  specific amount of transactions. 10x more transactions and the electricity cost will still be the same. Also the electricity costs are not your problem. Other people pay for it and apparently they believe in bitcoin, you can just freely transact thanks to that.
Jannes
CC BY-SA 3.0
2014-11-09T01:08:53.057Z
@MaǳiKoǌo then you consider quantum mechanics part if mathematics and problematic? Like it if not (I'm not getting into this btw....) the govt serves some roles
Wizard Of Ozzie
CC BY-SA 3.0
2014-11-10T06:11:26.957Z
@Wizard Of Ozzie uhm, I don't understand your sentence? But if you're hinting about quantum computing being a problem for Bitcoin: no, it's not. On the contrary, in fact, it's a problem for most banking and other financial protocols, which are far less flexible and adaptive than Bitcoin, so it'd be an excellent opportunity for Bitcoin as a safe haven.
Maǳi Koǌo
CC BY-SA 3.0
2014-11-12T05:59:27.267Z
@Sebastian Kovats besides trust between buyer and seller, other payment systems also fully depend on a 3rd party middle man to facilitate the payment. Paypal, credit card companies, banks, you name it. These have proven to be untrustworthy: paypal and visa randomly blocking payments for political motives (e.g. to wikileaks), paypal randomly freezing accounts (see sites like paypalsucks.com for tons of horror stories), banks appearing in the news for one scandal after the other, etc. Bitcoin completely removes this dependency on a 3rd trusted party.
Maǳi Koǌo
CC BY-SA 3.0
2014-11-12T11:13:58.363Z
That's true, bitcoin does have advantages over other payment systems but it is not better in every single way. Most normal people don't care too much about anonymity and independence, they would rather have someone (the middleman) to blame if anything goes wrong.
Sebastian Kovats
CC BY-SA 3.0
2017-11-04T15:26:11.237Z
Banking systems process far more transactions, and critically, provide credit- something Bitcoin does not do. Credit makes any financial system dangerous.
noɥʇʎԀʎzɐɹƆ
CC BY-SA 3.0
2014-11-02T22:18:37.443Z
2014-11-02T22:18:37.443Z
Maǳi Koǌo
<p>So I've been trying to figure out how much running the Bitcoin system really costs using the following numbers:</p>

<ul>
<li>Total Bitcoin Hash Rate: 300.000.000 GH/s </li>
<li>Hashrate of an ANTMINER S4 (currently one of the most efficient ASICs): 2.000 GH/s Power</li>
<li>power consumption of an ANTMINER S4: 1.400W </li>
<li><p>Energy price: $0.15/kWh</p></li>
<li><p>300.000.000 / 2.000 = 150.000 Antminers</p></li>
<li>150.000 * 1400W = 210.000.000W</li>
<li>210.000.000W * 24 hours = 5.040.000.000 Wh = 5.040.000 kWh</li>
<li>5.040.000 * $0.15 = 756.000$</li>
</ul>

<p>Taking into account other less efficient rigs around $1.000.000 seems (theoretically) realistic to me, but I just can't wrap my head around Bitcoin costing $364.000.000 per year. What am I doing wrong?</p>

CC BY-SA 3.0
2014-11-09T01:06:22.080Z
Yes, it's problematic. It keep the system going but it certainly looks bad in raw figures
Wizard Of Ozzie
<energy-consumption>
Can it really be true that the Bitcoin system consumes almost $1.000.000 in electricity per day?
Sebastian Kovats
# Can it really be true that the Bitcoin system consumes almost $1.000.000 in electricity per day?

(Asked by: username_0 on 2014-11-02)

So I've been trying to figure out how much running the Bitcoin system really costs using the following numbers:

* Total Bitcoin Hash Rate: 300.000.000 GH/s
* Hashrate of an ANTMINER S4 (currently one of the most efficient ASICs): 2.000 GH/s Power
* power consumption of an ANTMINER S4: 1.400W
* Energy price: $0.15/kWh
* 300.000.000 / 2.000 = 150.000 Antminers
* 150.000 \* 1400W = 210.000.000W
* 210.000.000W \* 24 hours = 5.040.000.000 Wh = 5.040.000 kWh
* 5.040.000 \* $0.15 = 756.000$

Taking into account other less efficient rigs around $1.000.000 seems (theoretically) realistic to me, but I just can't wrap my head around Bitcoin costing $364.000.000 per year. What am I doing wrong?

**Tags:** energy-consumption

> **Comments:**
> **username_1**: Yes, it's problematic. It keep the system going but it certainly looks bad in raw figures  

---

## 1 answers

### Answer by username_2 on 2014-11-02. Score: 6

Of course. At the current block reward of 25 BTC per block, on average 3600 BTC are mined per day which are worth over $1 million.

If it were significantly much cheaper than $1M (in terms of energy costs) to mine that $1M worth of coins, more people would do so, thus the difficulty would go up, thus the energy costs would go up.

By definition, the energy costs to mine x amount of bitcoins will never be significantly less than the actual worth of those bitcoins.

By the way, "wasting" (well, not really) only $365M per year is an incredible efficient improvement over the current banking system worldwide. The huge costs, waste of resources, and TONS of other collateral damage that come with the fiat currency infrastructure is astronomical, and saying that it's much, *MUCH* more than the costs of Bitcoin is even still an understatement.

> **Comments:**
> **username_3**: The asker never used the word waste.  
> **username_4**: You could improve your comparison with fiat by showing how much they (e.g. US dollar or Euro) spend every year.  
> **username_0**: That's the thing, if it's 1 million a day that's $14 per transaction (around 70.000 yesterday) which I think is comparably high (if not higher) than the cost of processing transactions in traditional banking systems. Hence i suppose that Bitcoin can only maintain its currently very appealing low transaction cost so long as miners can make a profit without charging transaction fees, which might eventually be just as high (if not higher, since miners compete which means resources are wasted) as those currently charged by banks.  
> **username_5**: username_0, you are absolutely right! The cost of supporting transactions in bitcoin is much more higher, than in centralized systems. Bitcoin is alive now only because it is ponzi.  
> **username_6**: username_0, your logic is reversed. If it's no longer profitable for miners, some will quit, and mining will become cheaper, rather than tx fees going up. The mining profit (block reward) vs costs (energy consumption) will always remain in a dynamic equilibrium. And @username_5 You better put your trust in fiat currencies then :)  
> **username_0**: That's true but if mining becomes cheaper because some miners quit, it follows that the value of bitcoins will not be justified anymore if it doesn't decline. I realise that neither fiat currencies are backed and limited since the gold standard was left, but they have powerful GOVERNMENTS behind them. What's behind Bitcoin if not miners' effort ?  
> **username_2**: Fiat has powerful governments, Bitcoin has powerful cryptography, transparency, lack of limitations or need for trust. I consider mathematical laws stronger than goverments laws.  
> **username_0**: About that trust thing, Bitcoin doesn't require less trust. If you buy something with a cfedit card you have a chance of getting back your money if you're ripped off (chargeback). Since Bitcoin transactions are irreversible, you need to trust the person you're sending to even more. Thus trust isn't made obsolete, it's just moved to another instance.  
> **username_7**: @username_0 multi signature transactions since this in a fundamentally better way than credit cards. Exactly because bitcoin is such a stable foundation, better solutions are being built on top of it. As for the  electricity cost: that's to maintain the network, not for a  specific amount of transactions. 10x more transactions and the electricity cost will still be the same. Also the electricity costs are not your problem. Other people pay for it and apparently they believe in bitcoin, you can just freely transact thanks to that.  
> **username_1**: @username_2 then you consider quantum mechanics part if mathematics and problematic? Like it if not (I'm not getting into this btw....) the govt serves some roles  
> **username_2**: @username_1 uhm, I don't understand your sentence? But if you're hinting about quantum computing being a problem for Bitcoin: no, it's not. On the contrary, in fact, it's a problem for most banking and other financial protocols, which are far less flexible and adaptive than Bitcoin, so it'd be an excellent opportunity for Bitcoin as a safe haven.  
> **username_2**: @username_0 besides trust between buyer and seller, other payment systems also fully depend on a 3rd party middle man to facilitate the payment. Paypal, credit card companies, banks, you name it. These have proven to be untrustworthy: paypal and visa randomly blocking payments for political motives (e.g. to wikileaks), paypal randomly freezing accounts (see sites like paypalsucks.com for tons of horror stories), banks appearing in the news for one scandal after the other, etc. Bitcoin completely removes this dependency on a 3rd trusted party.  
> **username_0**: That's true, bitcoin does have advantages over other payment systems but it is not better in every single way. Most normal people don't care too much about anonymity and independence, they would rather have someone (the middleman) to blame if anything goes wrong.  
> **username_8**: Banking systems process far more transactions, and critically, provide credit- something Bitcoin does not do. Credit makes any financial system dangerous.  

---

