The energy increases with the volume of transactions because there will be more people calculating hashes. The more people mining, the harder they make the hash calculation so that the target is ten minutes. More transactions = more people mining because there is more demand to verify blocks.
Transaction number is not correlated with mining energy expenditure.
Mining is used to secure the ledger in a way that the same amount of energy is needed to alter it.
The block hash begins with a number of zeros.
Try for yourself how many tries it takes to find a string that hashes to a hash beginning with 3 zeros.
Bitcoin block hashes begin with 13 or 14 zeros IIRC. This means that you need to try trillions of combinations again if you want to alter a block. And then you must keep finding other hashes with enough zeros fast enough to outcompete the whole network.
But the cost of hashing is the same, with 1, 10 or 1000 transactions in a block. And the block time is on average fixed at 10 minutes.
You don't hash transactions directly, you hash a block header that keeps only the merkle root hash of the transactions. The merkle root is fixed size.
You're only kind of right. The mining algorithm cares not one bit about number of transactions, so higher tx volume has no direct effect on the mining energy expenditure. But it does have a second order effect.
More transactions usually entails higher fees (as people compete for block space to put their transactions in). More fees means higher mining rewards, means higher incentive to mine, means more mining activity, and, therefore, higher energy expenditure.
Actually it does to some extent because the transaction hashes are used to calculate the block header hash.
But, it gets worse simply maintaining value takes hashing power to avoid a bad actor double spending and destroying faith in the system. Thus, even as a value store you need to pay for large scale hashing.
If you mean that over time the incentive to centralization become stronger, yes, you are right. There must be competition to enter the blocks, otherwise when mining subsidy ends, there will be no incentive to secure the ledger.
If you mean that ten times the transaction have a computational cost 10 times greater (or 5, or 2), you're wrong.
> The whole point of the system is to verify transactions and it stops working if it doesn't do that.
Plenty of cryptocurrencies are mining tons of empty blocks. on the short term, if there are no transactions, mining continues with the same difficulty.
The effect is long term: if noone is using the currency for transaction, it has no value so less and less people mine it. The difficulty drops, and the security drops, pulling value down even more.
You are almost right, but it is a very indirect effect, and takes years to manifest itself.
The number of transactions is entirely unrelated to the number of people mining. There could be an increase in transactions while the number of miners falls, or vice a versa. This is why the hash difficulty adjusts, to ensure that the new block rate (and therefore the transaction rate) stays the the same regardless of the number of miners.
If the number of miners dropped, energy use would drop, but transaction throughput would remain exactly the same.
Also, transaction size (in value) is entirely unrelated to transaction size (in kilobytes) which is what effects the number of transactions that can happen. Most transactions that just transfer some bitcoin from one assess to another are exactly the same number of kilobytes irrespective of how many bitcoin are being transferred.
I also commented elsewhere to this effect, but this is not quite true: number of transactions correlates very strongly with higher transaction fees, which further incentivises mining activity. Higher transaction volumes also usually come hand in hand with higher prices, which is another incentive for mining activity. Just because there is no direct effect (which you're absolutely right — the mining algorithm cares not one bit about the transaction volume) doesn't mean there aren't second order effects at play.
The post I replied to was claiming that more transactions strictly required more miners to process them, which isn't true. Yes, more transactions might incentiveise more miners, but it doesn't require them. And it's only one part of the complex interplay of incentives that miners face.
Say price dropped sharply, that could result in an increase in transactions as speculators scrambled to get their coins to an exchange to sell, while at the same time we might see a drop in miners because with lower bitcoin priced there is less payout for mining.
Ultimately the sequence of incentives and disincentives that drive miners is complex. Because of course, although a drop in price might deter some miners, if others believed that the drop was only temporary may continue mining and just hold the bitcoin to sell later when the price recovers. I think it's hard to say anything totally concrete about the expected miner behaviour following any event.
