Carbon Accounting 1 Bitcoin and the Network | Hashpower Academy

Video Transcript:

Did you know that Bitcoin as a planetary scale energybased currency is on the path to becoming completely carbon negative? Now, to explain this ordeal, we’re going to show you the mathematical chain of Bitcoin, but also some clear numbers to show that even just one single mining machine plugged into a power source that is carbon mitigating in effect will allow you to hold one whole Bitcoin in a green and sustainable way. Now, this is a particular video focusing, yes, on carbon accounting. If you care about carbon accounting, this is going to be important. If you don’t care, you’re still going to learn a lot of things that you can provide as knowledge to others. So let’s begin. The first thing to understand is the chain of different pieces that connect Bitcoin Bitcoin together. We produce electricity to produce compute power to produce Bitcoin through the blockchain. Now the carbon accounting aspect is to the inputs of these different power sources. solar, wind, hydro, nuclear, methane mining, which is the effect of burning methane into CO2. Yes, it’s getting released, but it reduces the warming effects and you can earn carbon credits in the process. And if just a small percentage of the entire Bitcoin network is essentially monetized through burning gas, well, it actually carbon negates the entire network. But let me just take you through a few of the numbers that will help you understand it a bit more clearly. But again, the key aspect here is you’ve got this commodity chain of different pieces of the network that are mathematically connected together through the digital and physical layers of the Bitcoin blockchain and the energy side being the the cost to add more blocks to the chain. So there is this pricing system that Bitcoin in of in of itself has to electricity and whichever power sources are emitting or producing carbon. So the difficulty adjustment is how we work things backwards. So the difficulty adjustment multiplied by this constant gets us the network hash rate. And the network hash rate provides us this understanding of how much how many computers are online. And if the computers are proving they are online by proving they’re producing Bitcoin, we can understand roughly how much energy underneath is being consumed. But here’s the thing. 913.5x a hash divided by the full 21 million bitcoin. If we’re going to account the hash rate, hash rate the hash rate which represents the computers online and we divide uh divide it by 21 million we will get a figure of because both of these are in millions in terms of terraash. So 21 million bitcoin let’s just keep it color consistent. So this is un this is dividing out the total network hash rate by the amount of Bitcoin that’s out there. And we get an answer of let me just be very specific with this. 43 5 terraash. Make sure I’m on the screen. 43.5 terraash. So 43.5 terraash is barely now half a computer of a single bitcoin asich and one 43.5 terraash um represents one whole bitcoin in terms of accounting of the network. As a network grows this will grow because obviously network is continually growing consuming more energy but the pricing system is still constrained to that 21 million bitcoin. So understanding how much energy is behind uh the the carbon accounting of a single bitcoin is to look at the percentage through the entire chain of different commodities. So 43.5 terraash costs let’s say $25 a terraash multiply that out that is times by yeah so 43.5 times by 25 equals a th00and 1 087 so a th00andish dollars of hash power accounts to one bitcoin. Now if one bitcoin isund $118,000 it’s about.92%. So to carbon account a single bitcoin of $118,000 as to when I was recording this, you need a $1,000 of hash power mining in a green sustainable way. So that your percentage of the network hash rate and energy use your essentially your representation of energy use in the network as a percentage to represent your amount of hash rate as a percentage of the network to represent one bitcoin out of 21 million in the network. You need $1,000 of hash power to carbon account one bitcoin of 119,000. So that is 0.92%. which essentially means that a fund or an investor that’s particularly focused on holding Bitcoin in a green sustainable way just add an extra 1% of cost of potentially purchasing mining machines that are deployed in locations that use carbon negative uh power sources such as on methane mining in Texas as one key example. Thank you for listening. I hope you enjoyed and I will see you potentially in the next video. Please like, subscribe, share this to someone that you think would be incredibly inspired to learn these sorts of things about Bitcoin. And I’ll see you in the next video. Goodbye.