Bitcoin mining is highly targeted for its increasing use of energy. The surge may be approaching a tipping point where, in order to prove to be a true game-changer, the crypto platform will need to get “cleaner and greener”.
However, Bitcoin is not getting much attention from investors – the main reason for this is the upcoming Ethereum merger.
Recently, Kyle MacDonald told CoinDesk TV’s “First Mover” that the Bitcoin network could be “regulated out of the way” due to its energy consumption.
Kyle MacDonald is an independent researcher. He predicts that the Bitcoin network may be “regulated away”, leading to a significant drop in prices.
MacDonald went on to suggest that people should now start selling bitcoin. The reason is that after the Ethereum blockchain made a switch to a significantly less energy-intensive method of validating transactions, called “Proof of Stake,” investors and regulators might realize that the energy-intensive method that Bitcoin uses, called “Proof of Work,” was not really necessary.
MacDonald said that the “climate crisis” and “Bitcoin’s massive energy use” are harmful. he said that, “Bitcoin doesn’t have the format like Ethereum to leave Proof of Work, it could be the first to get regulated away.”
Crypto energy consumption has become a major concern and a subject of contention among environmental activists and governments alike. MacDonald added that Bitcoin will never see $69,000 again. Bitcoin (BTC) traded near this level last November.
The next Ethereum upgrade, which is essentially a software update called “merge,” is expected to happen this month, and the main advantage of this is that not many computers will be needed to keep the Blockchain going.
MacDonald added, “The potential for Ethereum to reduce energy costs by 99.95% is very realistic.”
“When you go from a system that is about generating as many random numbers as possible as quickly as possible using 10 million GPUs worldwide, to one that runs on a few thousand very low-powered computers, it makes a huge difference.” GPUs are used in cryptocurrency mining.
In order to track the movement of energy in Ethereum, McDonald has created an Ethereum emissions tracker, which takes a “bottom-up” approach. According to the McDonald’s website, it does not take into account the price of Ethereum or the price of electricity.
He said, “I started with hashes, and then I look at devices and make a technical argument about how much electricity to use.”
NFT . Risks
MacDonald points out one notable risk, which is related to non-fungible tokens (NFTs). He said, “There is a good chance that some miners will switch to Proof of Work temporarily after the merger occurs.”
He added that there is a possibility that even if miners switch, there may be duplicates of NFTs for a short period of time on another chain. So, if it does, it can happen “Potentially dilute their values.”
The world’s largest NFT marketplace – OpenSea, He said It will only support the Proof of Interest chain and added that it is preparing for the transition in order to make sure the process runs smoothly.
Why upgrade Necessary?
Shockingly, a single Ethereum transaction can use up the same amount of energy as the average American household in over a week. Bitcoin energy consumption is worse!
The world’s largest cryptocurrency, Bitcoin, consumes an estimated 150 TWh of electricity annually, which is more than the entire country of Argentina with a population of 45 million. The production of this amount of energy produces about 65 megatons of carbon dioxide in the atmosphere annually, which is comparable to the emissions of Greece, making the cryptocurrency an important contributor to global air pollution and climate change.