What are the benefits of cryptocurrency hydro mining?
Apart from using eco-friendly energy sources, hydro mining provides increased reliability, cost-savings and enhanced performance.
Mining requires powerful, specialist computer equipment to run continuously throughout the day under extremely high loads. This means that failures and breakdowns due to overheating is a very real problem in cryptocurrency mining.
Every day, even every hour of downtime means the operation is losing money.
By using water-cooling systems in the hydro-mining process ensures that the mining rigs and processors are kept at a safe operating temperature at a lower cost. This creates a more reliable mining environment with minimum downtime due to failure.
Also due to the enhanced cooling mechanisms, HydroMiner for example, can maintain consistent lower temperatures at a very high density. The performance of mining equipment can, therefore, be optimized for the highest possible mining power they can deliver at a consistent tempo.
Electricity is also the biggest overhead of any mining operation.
By using one of the cheapest, most natural forms of electricity generation, i.e. hydropower, energy consumption is significantly less than on conventional mining farms. Lower energy consumption means increased cost-savings and higher profit margins that can be passed on to investors.
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Why is hydro mining important for cryptocurrency mining?
It provides an eco-friendly energy source for power-hungry cryptocurrency mining.
In a time when we are all becoming more environmentally conscious, the biggest criticism against cryptocurrency mining is that it takes excessive amounts of electricity to execute.
Mining Bitcoin and Ethereum, two of the most valuable cryptocurrencies, uses the same amount of energy as Morocco, a country with a population of close to 36 mln.
A single Ethereum transaction consumes 53 kWh. In comparison, a dishwasher appliance consumes an average of 288 kWh in a whole year. That means for only five Ethereum transactions you can power your dishwasher for an entire year.
And if you think that around 300,000 transactions are being processed on the Ethereum network every day, that’s a lot of dishwashers.
In fact, according to data compiled by Digiconomist, a single transaction on the Ethereum network can power a typical American household for 1.5 days. At 5.5 days per transaction, Bitcoin is even more energy hungry.
The chart below shows how the energy consumption in mining Bitcoin has drastically increased in the space of just one month.
Without cryptography, Blockchain technology loses one of its core benefits, which is security.
Unfortunately, solving the complex algorithms to decipher the cryptography requires enormous amounts of electricity, most of the time from using non-renewable energy sources.
A company like HydroMiner uses hydropower to fuel its mining operations which is one of the most effective and low-cost, renewable energy resources globally. It is environmentally friendly, carbon neutral and natural.
In addition, using water to cool mining equipment can reduce cost by up to 85 percent less than the average electricity costs in Europe.
From an environmental standpoint, it’s therefore important for cryptocurrency mining to move to a more eco-friendly energy source that not only reduces the cost of electricity consumption but also generates it from renewable sources, minimizing the carbon footprint of such operations.
How has cryptocurrency mining changed?
The process is still the same, but the scale of operations is much larger.
Cryptocurrency mining used to be something that non-specialized hardware could do. However, as the market evolved, miners have come to rely on powerful systems and graphics cards to process computations profitably.
Many years ago it was profitable for individuals to mine cryptocurrencies from home on a personal computer, but the industry has grown into large-scale mining farms that use massive amounts of energy. It has become too expensive for single miners doing it from home to stay competitive and is therefore not a feasible option anymore.
It also means that, as cryptocurrency mining has exploded in the last few years, so too has electricity usage related to big mining farms. If the industry is left to continue burning energy from exhaustible fossil fuels, it will cause significant damage to the environment in the form of pollution and climate-changing greenhouse gases.
What is hydro mining?
It refers to a specific method of cryptocurrency mining that relies on hydroelectric power and water cooling systems to create an energy-efficient and highly-profitable mining operation.
Simply put, cryptocurrency mining is the process of creating new digital coins and verifying these transactions at the same time. Individuals are constantly sending cryptocurrencies, like Bitcoin, to each other over a network called Blockchain.
To keep track of all of these transactions, the Blockchain network collects all transactions made during a set period of time into a list, or a “block.” The miner’s job is to confirm these transactions and write them onto an immutable public ledger by solving complex mathematical equations.
The process requires a lot of computing power which in turn burns huge amounts of electricity.