Satoshi Explains Bitcoin Mining Energy Consumption
With the price of Bitcoin soaring over the years, it is safe to say that the digital asset has attracted so many people both in and out of the financial system. Even though investing in the asset is lucrative, it is a widely known fact that the digital asset still has those opposed to its existence.
While some people are still of the opinion that the digital asset is a bubble that would one day burst, others find it hard to cope with the rate at which mining the asset consumes energy. Besides those two, others have criticized digital assets for their scaling problems and the high transaction fees rate.
The explanations were seen on Reddit
While others have pointed out the opposing sides of the digital asset, the proponents have always done their bit to show that the digital asset is the future of the financial market. Regarding the energy consumption part, the best definition of that one might still explain that the father and creator made of the digital asset, Satoshi Nakamoto.
During the weekend, the developer’s response was seen on Reddit, where he made a case for the energy consumption in terms of mining of the digital asset. In the explanation, he pointed out that crypto exchanges would be able to use Bitcoin more than the cost it will take to mine the asset. He pointed that if they do not own the coin, it would be a waste on their part.
To mine the digital asset, miners use enhanced equipment to solve cryptographic puzzles, and if they are successful at the end of the day, they get rewarded with Bitcoin. To buttress how competitive the task is, miners, over the years, have been forced to use very high-powered mining equipments to get ahead of their competition in the business.
Satoshi likened Bitcoin mining to gold mining
With miners making use of more powerful equipment, they use a lot of energy in the process of mining. Before the invention of Bitcoin, most people that have tried to distribute various digital assets over the years have failed woefully. In his argument, Nakamoto mentioned that there was no way that miners could distribute the digital asset in a decentralized manner without first burning up a ridiculous amount of energy.
Giving his example, Satoshi talked about mining gold. He pointed out that even though mining gold is a waste, it does not rule out the fact that having gold as a medium of exchange is better than not having it at all. Like Bitcoin, mining gold is very power-consuming because you will have to extract it from the earth. Unlike Bitcoin, where you will solve puzzles to get your rewards. Also, mining is a free market, and most miners don’t eventually get the most rewards, unlike the final consumers who would buy and earn rewards.