Q3 Sees Bitcoin Hashrate Rise Almost 50% Against Post-China Ban Lows
The Bitcoin mining industry has seen notable changes following China’s ban Including a 48% increase in Bitcoin’s hashrate over post-China ban lows, the Bitcoin Mining Council’s (BMC) Q3 report has shown.
The finding forms a part of the survey results from 29 companies which is supposedly representative of about 33% of the network.
“As you know, in Q3, we had an extraordinary dislocation and restructuring of the Bitcoin mining network due to the Chinese exodus and lots of the hashrate came offline and the hashrate redistributed itself,” says Michael Saylor of MicroStrategy, in a live presentation of the report on behalf of the voluntary association of Bitcoin miners seeking to educate the public about the industry.
“So, it’s been a very dynamic quarter.”
BMC estimates that despite an increased hashrate, Bitcoin’s energy appetite only increased by 21% in the last quarter as more efficient hardware like the Antminer S19 and Whatsminer M30 series were deployed.
The group expects Bitcoin mining to “be dramatically more energy efficient in the next eight years.” This is based on its estimated “3x and 2x improvement in mining efficiency over the next four and following four years, respectively” and the fact that “Satoshi’s protocol reduces energy consumption incentives by 2x every 4 years, for the foreseeable future.”
To compile the report, the BMC indicates that Bitcoin miners around the world were surveyed based on three questions: how much electricity does your total fleet consume today?; what is the total % of sustainable electricity* within your fleet’s power generation mix today?; and what is the total aggregate hashrate of your fleet today?
It finds through hardware data from respective hardware manufacturer websites, among other things, that the efficiency of Bitcoin mining’s intensive technology has increased 42x the past eight years – that is a 4,237% increase in joule-per-terahash efficiency of mining hardware over the period.
Other highlights of the report include pointing out that Bitcoin mining has seen a 4x increase from 2020 in terms of revenue to become a $15-20 billion industry in 2021.
The Council estimates that Bitcoin mining currently consumes 188 TWh of energy (or 0.12% of the world’s total energy output of 154k TWh) and 0.32% of its wasted energy (50k TWh).
It adds that roughly 57% of the global Bitcoin mining industry is now estimated to be powered by renewable energy making it have the highest sustainable energy mix when compared to countries like Germany (48.5%), US (31.4%) and China (16.4%).
Bitcoin’s energy consumption has been a topic of interest of late going by the carbon emission reduction efforts across the board including in China. Based on a Bitcoin blockchain carbon emission model, a study published in the broad open-access Nature journal in April estimated that CO2 emissions from China attributed to the Bitcoin blockchain between January 2016 and June 2018 was up to 13 million metric tons.
In May, China launched a crackdown on cryptocurrency trading and mining with some provinces citing the huge energy consumption and for running contrary to China’s “carbon neutrality peak” goal as a factor. The move had a far-reaching effect on the crypto market as a whole so much that Elon Musk’s Tesla stopped accepting Bitcoin as a payment method because of environmental concerns.
Several options were proffered at the time to help the industry navigate its most difficult conundrum. They include the formation of the BMC and heightened push for investment in green energy to reduce carbon emissions.