Bitcoin’s energy efficiency has long been a concern as mining activities consume significant amounts of electricity. However, a recent report by Coinmetrics reveals that the energy efficiency of Bitcoin has improved significantly over the past five years. The report also highlights that three mining rig models dominate the Bitcoin network’s computing power, reinforcing the need for greater energy efficiency in mining operations.
The three mining rig models identified in the report are the Antminer S19j Pro, Antminer S19 XP, and Antminer A19. Coinmetrics found that these three models collectively account for 76% of the network’s hashrate, indicating their widespread usage among Bitcoin miners. Specifically, the Antminer S19j Pro holds the largest share at 34.3%, followed by the Antminer S19 at 28.1%. The Antminer S19 XP lags behind with only 13.7% of the network’s hashrate.
Bitcoin’s Energy Efficiency Shows Significant Improvement
Bitcoin’s energy efficiency has historically been a point of concern due to the high energy consumption of mining equipment. However, the Coinmetrics report suggests that the network’s energy efficiency has improved by approximately 60% since July 2018, when newer and more efficient mining machines were introduced. The report states that the Bitcoin network now consumes an average of 33.6 joules per tetrahash (J/TH) of computing power, representing a 62% increase in energy efficiency compared to July 2018’s measurement of 89.3 J/TH.
Karim Helmy, one of the authors of the report, emphasizes that the rate of improvement in energy consumption has slowed down compared to previous years. This indicates that the Bitcoin network has made significant strides in enhancing its energy efficiency and is now operating at a more sustainable level.
Bitcoin Miners Shift Towards Renewable Energy Sources
Recognizing the environmental impact of high energy consumption, Bitcoin miners are increasingly turning to sustainable and green energy sources. A study by CoinShares found that 74.1% of Bitcoin mining power is derived from renewable energy. This shift towards renewable energy is crucial in mitigating the negative effects of Bitcoin mining on the environment.
In line with this trend, Volcano Energy, a startup based in El Salvador, has initiated a project to build a 241 MW renewable energy power generation park. The project has already secured an initial funding round of $250 million out of its total commitment of $1 billion. Tether, the issuer of the USDT stablecoin, is among the investors and plans to contribute its expertise to ensure the success of the project.
Overall, the dominance of three mining rig models in the Bitcoin network’s computing power highlights the importance of energy efficiency in mining operations. The significant improvement in Bitcoin’s energy efficiency over the past five years demonstrates the industry’s commitment to reducing its environmental footprint. With the increasing adoption of renewable energy sources, Bitcoin mining is taking a step towards a more sustainable future.