The enormous use of energy needed to mine bitcoin and other cryptocurrencies is proving to be very contentious, but alternative methods pose far too much of a security risk. The recent warning that electricity use at bitcoin mining facilities in Iceland may exceed that consumed annually by the country’s homes, which could in turn lead to a potential energy shortage, was slightly alarmist in tone. But it showcases the huge amount of computational power needed to mine cryptocurrencies.
More recently, the concept of “virtual mining” has also emerged to address the high energy consumption of cryptocurrency mining by removing the need for performing computations altogether. This works by tying a miner’s vote proportionally to their cryptocurrency holdings—an approach that became known as proof-of-stake (PoS).
So—for now—PoW remains the best available mechanism to maintain and secure decentralized cryptocurrency systems. Many believe that mining, while energy-sapping, should remain resource-intensive to make it prohibitively expensive for any single entity to gain sustained control over the decentralized system.
Given how quickly computing technology develops, perhaps an alternative method will be found. Until then, we appear stuck—for better or worse—with a drain on computational systems and energy resources to power bitcoin and other cryptocurrency networks securely.
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