UN University Data About Energy Consumption for Bitcoin Mining Is Misleading: The Company Okhotnikov on the Real Reasons for the Incorrect Report
In recent years, the issues of electricity consumption in the cryptocurrency world have become the subject of heated debate. In this сonnection the UN University (United Nations University) published its study to determine the true extent of the problem. The article offers an analysis of this report based on data from the company Okhotnikov. Vladimir Okhotnikov, a founder of an analytical platform, identified inconsistencies in the information provided by the University about the energy consumption for Bitcoin mining.
Vladimir Okhotnikov: The study error lies in the methodology
Vladimir Okhotnikov believes that the key factors determining the amount of energy spent on hashing are the price of bitcoins, the complexity of crypto mining and the efficiency of mining equipment.
Margot Paes, a research fellow at the Bitcoin Policy Institute, Master of Physics and Ethnomusicology, states that for a more accurate analysis of the Cambridge Blockchain Network Sustainability Index: CBECI data it is necessary to consider these statistics separately, without combining the indicators for 2020 and 2021, which will give a clearer idea about the dynamics of analyzed parameters.
In addition, Vladimir Okhotnikov points out that using the same methodology without taking into account geopolitical changes can lead to unreliable results.
“…China’s dominance in Bitcoin mining came to an abrupt end after the government imposed a ban on this activity. This step led to the flow of mining capacity to other regions, which changes the geography of computational mining,” the report says.
Commenting on the effectiveness of bitcoin technology Vladimir Okhotnikov notes that the blockchain of this virtual currency has been functioning without failures for 15 years, despite all the challenges. He also predicts that the miner relocation program could last until 2030.
Miners in Ethiopia: Bitcoin mining in conditions of economic instability and climatic peculiarities
According to Ethiopian Electric Power (EEP), the GERD hydroelectric power plant will double the generating capacity for Ethiopia, creating an attractive environment for the development of Bitcoin mining. Vitaly Borshchenko, CEO of BWP, notes that the benefits in this area are not limited to cheap renewable energy.
The weather patterns of the region also play an important role. Mr. Borshchenko emphasizes that the ideal mining temperature coincides with the climatic conditions of Ethiopia, which makes the country attractive for investors in this industry.
Despite the unstable political and economic situation of the republic, miners have shown a willingness to invest tens of millions of dollars in equipment for crypto mining. This indicates their desire to maintain the business at any cost, despite the risks.
In conclusion of the article, Vladimir Okhotnikov says that the main reason for the inaccuracy of the data provided by the UN University regarding energy consumption in Bitcoin mining is the use of a single approach to calculations, which does not take into account all the factors and features of the virtual market.
Accurate calculations are hampered by the decentralized nature of electronic currency, and approximate energy consumption can only be estimated indirectly through mining profits.
For a more detailed review from experts, read the original article UN University Distorts Information On The Energy Use For Bitcoin Mining.
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The company Okhotnikov under Vladimir Okhotnikov’s leadership offers comprehensive services: from in-depth analysis of the cryptocurrency market to the development of strategies and the creation of White Papers. Our expertise will help you effectively advise your clients in the field of blockchain and decentralized finance.
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