Bitcoin is an exceptionally flexible energy consumer, data analytics and research firm Arcane Research noted in its report titled: «How Bitcoin Mining Can Transform the Energy Industry».
Bitcoin's energy consumption has been one of the most controversial topics discussed in the crypto industry. However, Arcane Research claims that a large part of the population, even within the crypto community, is unaware of the key aspects that make Bitcoin an exceptionally flexible energy consumer that is very different from the rest.
Arcane Research listed these aspects in its report «How Bitcoin Mining Can Transform the Energy Industry», where it provides a List of 5 characteristics of Bitcoin's energy consumption. Let's see.
The energy consumption of the Bitcoin network
Perhaps the most notable aspect of Bitcoin's energy consumption is the unique flexibility with which miners of this cryptocurrency can literally move based on energy availability.
As Arcane Research explains, Bitcoin miners are exceptionally flexible about when and where they consume energy; a reality that is particularly useful in helping to strengthen energy networks and solve some of the biggest problems that exist within this sector today, such as gas flaring.
1. Bitcoin mining is sensitive to the price of electricity
Bitcoin miners act as an energy “refiner” in the industry. “The miner sends electricity to his machines, which refines the electricity into bitcoin”, the research and analytics firm said. However, crypto miners are particularly sensitive to the price of electricity, as it accounts for about 80% of the network's operating costs.
Therefore, depending on the electricity costs, the miners of this cryptocurrency have the ability to Adjust Bitcoin's energy consumption up or down or move their operations with relative ease, in search of cheaper electricity.
Source: Arcane Research
2. Bitcoin mining is interruptible
Bitcoin miners can connect and disconnect their equipment from the network without causing damage to it.
An example of this characteristic was seen last year when the Chinese government imposed harsh measures against companies engaged in this industry. Although the hash rate or Bitcoin's computing power decreased in the weeks following China's ban on BTC mining and use, the blockchain network has recovered significantly today. Even last June, Bitcoin marked a new all-time high in its hash rate, when it reached a power of 231,5 exahashes per second (EH/s).
Miners have also immediately switched off their equipment during weather changes and severe storms seen in the state of Texas (United States), in order to support the local government and ensure energy supply to citizens. The same case has occurred with BTC miners in Iran in the last year.
Therefore, Arcane Research highlighted that Bitcoin miners can interrupt your energy production and consumption at any time, unlike data centers in other industries, such as those used by social media platforms.
Source: Arcane Research
3. Bitcoin miners are agnostic
Bitcoin miners can Locate their mining facilities almost anywhere in the world where there is cheap energy and Internet access.
Of course, this availability is also subject to the laws and regulations existing in the different countries regarding the activity of extracting bitcoins from the network. But, in general, the Bitcoin industry allows the energy consumer to be brought directly to the energy source, Arcane Research indicated; therefore, this industry can significantly contribute to reducing several of the problems that affect the electrical system, such as energy waste and the burning of natural gas, and to promoting the use of renewable energy sources.
4. Bitcoin energy consumption is modular
Another feature of Bitcoin's energy consumption is modularity, which allows adjust or design the network mining load to match the available power generation capacity.
Arcane Research explained that this capability allows for improved economics and efficient energy use, especially when combining the mining load of the Bitcoin network with the excess production capacity of a power generator.
Source: Arcane Research
5. Portability in Bitcoin mining
In the Bitcoin industry, it is increasingly common to observe Solutions designed under the “Plug-and-Play” model to optimize the portability of BTC minersIn this industry, miners have the ability to move their mining machines to take advantage of the energy surplus in a certain area or region and, when this energy is no longer available in excess, they can move to a new location.
Source: Arcane Research
Bitcoin as a tool to strengthen the energy system
After evaluating these 5 key features, Arcane Research has differentiated Bitcoin's energy consumption from other networks and industries, highlighting how the network is serving as a powerful energy tool which can help solve some of today's biggest energy challenges.
In conclusion, the research and analysis firm indicated that Bitcoin mining can “strengthen power grids, improve the economics of renewable energy, mitigate natural gas flaring, and reduce heating costs” by reusing the heat generated by crypto mining equipment and facilities.
Continue reading: Bitcoin mining could save the environment
