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The transaction behavior of cryptocurrency and electricity consumption

Rapidly increasing cryptocurrency prices have encouraged cryptocurrency miners to participate in cryptocurrency production, increasing network hashrates and electricity consumption. Growth in network hashrates has further crowded out small cryptocurrency investors owing to the heightened costs of mi...

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Detalles Bibliográficos
Autores principales: Zheng, Mingbo, Feng, Gen-Fu, Zhao, Xinxin, Chang, Chun-Ping
Formato: Online Artículo Texto
Lenguaje:English
Publicado: Springer Berlin Heidelberg 2023
Materias:
Acceso en línea:https://www.ncbi.nlm.nih.gov/pmc/articles/PMC9845105/
https://www.ncbi.nlm.nih.gov/pubmed/36687794
http://dx.doi.org/10.1186/s40854-023-00449-7
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author Zheng, Mingbo
Feng, Gen-Fu
Zhao, Xinxin
Chang, Chun-Ping
author_facet Zheng, Mingbo
Feng, Gen-Fu
Zhao, Xinxin
Chang, Chun-Ping
author_sort Zheng, Mingbo
collection PubMed
description Rapidly increasing cryptocurrency prices have encouraged cryptocurrency miners to participate in cryptocurrency production, increasing network hashrates and electricity consumption. Growth in network hashrates has further crowded out small cryptocurrency investors owing to the heightened costs of mining hardware and electricity. These changes prompt cryptocurrency miners to become new investors, leading to cryptocurrency price increases. The potential bidirectional relationship between cryptocurrency price and electricity consumption remains unidentified. Hence, this research thus utilizes July 31 2015–July 12 2019 data from 13 cryptocurrencies to investigate the short- and long-run causal effects between cryptocurrency transaction and electricity consumption. Particularly, we consider structural breaks induced by external shocks through stationary analysis and comovement relationships. Over the examined time period, we found that the series of cryptocurrency transaction and electricity consumption gradually returns to mean convergence after undergoing daily shocks, with prices trending together with hashrates. Transaction fluctuations exert both a temporary effect and permanent influence on electricity consumption. Therefore, owing to the computational power deployed to wherever high profit is found, transactions are vital determinants of electricity consumption.
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spelling pubmed-98451052023-01-18 The transaction behavior of cryptocurrency and electricity consumption Zheng, Mingbo Feng, Gen-Fu Zhao, Xinxin Chang, Chun-Ping Financ Innov Research Rapidly increasing cryptocurrency prices have encouraged cryptocurrency miners to participate in cryptocurrency production, increasing network hashrates and electricity consumption. Growth in network hashrates has further crowded out small cryptocurrency investors owing to the heightened costs of mining hardware and electricity. These changes prompt cryptocurrency miners to become new investors, leading to cryptocurrency price increases. The potential bidirectional relationship between cryptocurrency price and electricity consumption remains unidentified. Hence, this research thus utilizes July 31 2015–July 12 2019 data from 13 cryptocurrencies to investigate the short- and long-run causal effects between cryptocurrency transaction and electricity consumption. Particularly, we consider structural breaks induced by external shocks through stationary analysis and comovement relationships. Over the examined time period, we found that the series of cryptocurrency transaction and electricity consumption gradually returns to mean convergence after undergoing daily shocks, with prices trending together with hashrates. Transaction fluctuations exert both a temporary effect and permanent influence on electricity consumption. Therefore, owing to the computational power deployed to wherever high profit is found, transactions are vital determinants of electricity consumption. Springer Berlin Heidelberg 2023-01-18 2023 /pmc/articles/PMC9845105/ /pubmed/36687794 http://dx.doi.org/10.1186/s40854-023-00449-7 Text en © The Author(s) 2023 https://creativecommons.org/licenses/by/4.0/Open AccessThis article is licensed under a Creative Commons Attribution 4.0 International License, which permits use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons licence, and indicate if changes were made. The images or other third party material in this article are included in the article's Creative Commons licence, unless indicated otherwise in a credit line to the material. If material is not included in the article's Creative Commons licence and your intended use is not permitted by statutory regulation or exceeds the permitted use, you will need to obtain permission directly from the copyright holder. To view a copy of this licence, visit http://creativecommons.org/licenses/by/4.0/ (https://creativecommons.org/licenses/by/4.0/) .
spellingShingle Research
Zheng, Mingbo
Feng, Gen-Fu
Zhao, Xinxin
Chang, Chun-Ping
The transaction behavior of cryptocurrency and electricity consumption
title The transaction behavior of cryptocurrency and electricity consumption
title_full The transaction behavior of cryptocurrency and electricity consumption
title_fullStr The transaction behavior of cryptocurrency and electricity consumption
title_full_unstemmed The transaction behavior of cryptocurrency and electricity consumption
title_short The transaction behavior of cryptocurrency and electricity consumption
title_sort transaction behavior of cryptocurrency and electricity consumption
topic Research
url https://www.ncbi.nlm.nih.gov/pmc/articles/PMC9845105/
https://www.ncbi.nlm.nih.gov/pubmed/36687794
http://dx.doi.org/10.1186/s40854-023-00449-7
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