Why and How Bitcoin Consumes Energy
Bitcoin’s energy consumption is complex and often misunderstood, so this rabbit hole provides some resources to help understand this topic.
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Created by Lyn Alden
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Bitcoin uses a proof-of-work protocol to operate the network, which means that miners expend real-world resources (electricity) in order to validate transactions and secure the blockchain. Rather than being a bug, this is a feature because it is what keeps the protocol decentralized.
Other consensus protocols such as proof-of-stake may have their use-cases, but they make numerous trade-offs compared to proof-of-work. They are far more complex, with more attack surfaces, and are prone to centralization over time.
In addition, Bitcoin miners use energy in a very unique and useful way. Specifically, unlike data centers or other types of electricity consumers, individual Bitcoin miners don’t require very high uptime or a lot of internet bandwidth, which means they can go to areas of stranded energy production or can be co-located with power generation facilities as load balancers.
![Lyn Alden](https://www.datocms-assets.com/55504/1640034287-lyn-alden-pic.jpg?ar=1%3A1&auto=format&crop=faces&dpr=0.15&fit=crop&q=75&w=800)
Lyn Alden
@lynaldencontactLyn Alden has a background that blends engineering and finance. As a former electrical engineer and current financial analyst, Bitcoin’s energy consumption is a topic that is of particular interest to her, especially because it is so broadly misunderstood.
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