How harmful is bitcoin mining for the planet? In a little more than a decade, bitcoin has gone from being a niche technology beloved. Among cryptographers to being the ninth most valuable asset. In the world by market capitalization.
The cryptocurrency’s meteoric rise has created billionaires, redefined money. And ushered in a multi-billion-dollar business that is inspired by the groundbreaking. Decentralised technology that underpins the cryptocurrency. However, it has also brought with it some unwelcome side effects as well.
The computational power necessary to support bitcoin’s underlying network now consumes. Roughly as much energy as the entire country of Argentina. Prompting concerns about the cryptocurrency’s environmental impact to be raise about it.
According to a study conducted by the University of Cambridge, the bitcoin network. Consumes more than 121 terawatt-hours (TWh) of electricity every year. Placing it in the top 30 electricity consumers in the world if it were a sovereign state.
Increasing energy demands have fueled by the growth in bitcoin’s price in recent months. Which has seen it rise from below $5,000 (£3,600) in March to close to $50,000 today, according to CoinDesk data.
Since the beginning of bitcoin’s existence, there have been concerns. About the cryptocurrency’s energy requirements, with crypto pioneer Hal Finney. Tweeting on 27 January 2009 about the cryptocurrency’s potential future CO2 emissions. As to How harmful is bitcoin mining, just two weeks after receiving the cryptocurrency’s pseudonymous creator. Who is Satoshi Nakamoto’s first ever bitcoin transaction.
After a strong price gain in 2017, the amount of energy consumed by the bitcoin network. Rose to the level of a small country, bringing it into the limelight for the first time.
Bitcoin’s energy use has quadrupled
In an interview with The Independent, Charles Hoskinson. CEO of leading cryptography firm IOHK, says that bitcoin’s energy consumption. Has more than quadrupled since the beginning of its last peak in 2017. “It is only going to get worse because energy inefficiency. Is build into bitcoin’s DNA,” Hoskinson says.
According to the author, “Bitcoin’s carbon footprint will worsen rapidly as its price grows. As there will be more rivalry for the currency. And hence more energy will consumed.”
Bitcoin’s environmental impact exacerbated by the fact that the vast majority of miners. Are headquartered in China, where coal accounts. For more than two-thirds of the country’s electricity generation.
Miners must solve complicated but arbitrary mathematical equations. In order to generate new units of the cryptocurrency, which requires. A massive amounts of computer processing power at the present time to complete.
As a result, bitcoin miners migrate to areas where electricity is the lowest. Indicating that the primary problem is not with bitcoin. But rather with a lack of affordable renewable energy supply.
Fortunately, alternatives are being put in place, with some environmentally friendly mining plants. Now running on a large scale and others in the works.
As a result of the availability of cheap hydroelectric and geothermal energy in Iceland and Norway. Where nearly 100 percent of all energy production is renewable, bitcoin miners. Are able to power their equipment with relative ease. The low temperatures in the countries also contribute to cost savings. By how harmful is bitcoin mining allowing the computer systems to cool themselves naturally.
According to the University of Cambridge’s third Global Cryptoasset Benchmarking Study. Which conducted last year, 76 percent of cryptocurrency miners use electricity derived.