Monday, January 23, 2023

How Much Power Does Bitcoin Network Consume? Here’s What Glassnode Estimates

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Here’s some data from Glassnode that reveals estimates related to the power consumption of the Bitcoin network, if all miners used the same mining machines.

Bitcoin Network Best-Case Scenario Would Be 4.8x More Efficient Than Worst-Case

As per the on-chain analytics firm Glassnode, the power estimates are based on the current hashrate of the BTC network. The “mining hashrate” is an indicator that measures the total amount of computing power connected to the Bitcoin blockchain right now.

In the real world, this hashrate is contributed by miners spread across the globe, who all have different situations and environments to deal with that result in different profit margins for each of them. The available capital with each miner can also be quite different, so only the largest companies can afford to upgrade their facilities to the latest and most efficient rigs.

All these differences result in a very diverse network, where a large variety of mining rigs would be in use between the miners, and even across the same facility, the machines may be a mix of old and new models.  This obviously makes it quite tricky to calculate a true power consumption estimate for Bitcoin, so what Glassnode has done is calculate the power of the network by assuming a uniform blockchain, for four different mining rigs. The below chart displays this data.

Looks like the worst-case scenario consumes nearly 24 GW in power | Source: Glassnode

The four machines used here are S9, S17, S19 Pro, and S19 XP Hyd from the Antminer series. Released in 2017, the S9 is the least efficient machine out of these, so the power consumption figure for the Bitcoin network if the entire hashrate was from S9 alone provides an approximate upper bound of almost 24 Gigawatt (GW). On the other hand, the best-case scenario (the S19 XP Hyd, launched this year) would put the figure at around 5 GW. Naturally, both these bounds are purely theoretical and are highly unlikely to be a representation of the real blockchain.

The actual power consumption figure is probably near the 7 GW and 11 GW estimates of the other two machines (S17 and S19 Pro, respectively). In fact, these hashrate-based figures are close to the Cambridge Bitcoin Electricity Consumption Index, which puts the estimated power at around 10 GW.

With these estimates for the different mining rigs, Glassnode has also showcased the efficiency gains involved with these machines. Compared to if the network had only S9, the S17 scenario would be 2.2x more efficient, while S19 Pro would be 3.3x. The S19 XP Hyd, the best case, is around 4.8x more efficient.

BTC Price

At the time of writing, Bitcoin’s price floats around $16,800, down 5% in the last week.

Bitcoin Price Chart

BTC continues to consolidate | Source: BTCUSD on TradingView

Featured image from Brian Wangenheim on Unsplash.com, charts from TradingView.com, Glassnode.com

Numisteamone

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