The Bitcoin has been gaining unprecedented momentum this year, as it has experienced a growth trajectory that has seen it shatter one record after another on the market. By many accounts of financial analysts, 2017 has truly been the year of the Bitcoin, after rebounding from a very rocky period in 2017.
One example of this, perhaps, is in the accelerated growth of not only bitcoin trading, but more importantly bitcoin mining. It serves as the most tangible way for private citizens interested in the cryptocurrency to experience all the benefits it purports to offer. Two such miners—Siberian entrepreneurs Ilya Frolov and Dmitry Tolmachyov—are a case in point. What makes their story unique is that they’re using two of the mining machines to heat their 20m2 cabin. More impressive is that they’re doing so while still generating $430 per month.
But how are they able to pull this off? Well, the heat generated by bitcoin transactions comes from the computer processing power that is required to carry them out. The smart Russian partners—based in Irkutsk—instead of allowing this ‘free heat’ to escape into the atmosphere, chose to harness it and use it as a source of heating in the house.
The Environmental Costs of Bitcoin Mining
Although the two are most likely acting out of self-interest, according to energy and environmental specialists, there may be unforeseen consequences associated with bitcoin mining, with 70% of the global hashrate located in China, a country where most of the energy to support the billion-dollar industry is generated by burning coal.
Confronted with the growing reality of the presence of the cryptocurrency, many have begun looking for creative solutions. One being offered is Delayed Proof of Work (DpoW) mining, a newer alternative which allows miners to “leverage the energy being wasted on Proof of Work for other computational-heavy services”. Both alternatives offer increased protection for the network; however, DpoW does so without requiring a sizable network of miners to offer this protection.
Yet still, there is another alternative, the Useful Work system, which was created with the idea of using storage space instead of computational power. In the white paper, titled “Filecoin: A Decentralized Storage Network”, it explains the many merits of the system.
“On-demand block generation saves energy on its own Blockchain whereas dPoW makes the Bitcoin Blockchain more energy efficient. When a transaction is detected in the mempool the mining process starts. This saves energy on many fronts; CPU cores sit idle when they aren't mining, comparable to proof of stake. This also leads to smaller Blockchain sizes due lack of empty blocks being mined, which leads to less syncing time and saving on space and electricity in the process.”
These developments are all indications of the fact that smart and responsible energy considerations that respect the environment will need to continue to evolve along with the cryptocurrency.