One of the leading discussions about Bitcoin (BTC) revolves around the ecological impact of mining because of the required energy to mine and transfer BTC. Now, a study has confirmed the negative impact bitcoin mining has on the environment. In fact, the findings indicate that mining is as damaging to the environment as crude oil and is less sustainable than beef production.
The Science and Other Stuff to Know
Researchers at The University of New Mexico compared the mining of Bitcoin to the impact of crude oil extraction. Their findings, which were published in Scientific Reports, indicate that Bitcoin mining is as harmful as oil.
“Globally, the mining, or production, of Bitcoin is using tremendous amounts of electricity, mostly from fossil fuels, such as coal and natural gas. This is causing huge amounts of air pollution and carbon emissions, which is negatively impacting our global climate and our health,” warns study co-author Professor Benjamin A. Jones.
The team looked at several factors to ascertain the impact of Bitcoin mining: whether the damage is increasing in time, whether the damage is comparable to the worth of a single Bitcoin, and how it fares compared to other products and industries.
According to the report, Bitcoin mining saw a sudden surge during the pandemic, and Bitcoin mining-related CO2 emissions went from 0.9 tons per coin in 2016 to 113 tons per coin in 2021. Ultimately, the respot estimates that a single coin mined during the pandemic had an environmental impact of about $11,314, with the total global damage exceeding the $12 billion mark between 2016 and 2021.
“We find several instances between 2016 [and] 2021 where Bitcoin is more damaging to the climate than a single Bitcoin is worth. Put differently, Bitcoin mining, in some instances, creates climate damages in excess of a coin’s value. This is extremely troubling from a sustainability perspective,” they added in the report.
Bitcoin-related climate damage peaked in May 2020, when each $1 of the coin’s market value created in that month cost about $1.56 in global climate damages.
According to the report, the situation is only worsening. One of the primary reasons for Bitcoin’s immense energy requirement is the consensus mechanism it uses, Proof of Work, which is not very energy efficient. For some time, other cryptocurrencies, such as Ethereum, have been switching to the Proof of Stake consensus mechanism to decrease their carbon footprints. Hopefully, Bitcoin will follow soon, but it seems not soon enough.
“We find no evidence that Bitcoin mining is becoming more sustainable over time,” concludes professor Jones. “Rather, our results suggest the opposite: Bitcoin mining is becoming dirtier and more damaging to the climate over time. In short, Bitcoin’s environmental footprint is moving in the wrong direction.”
It’s true that some industries, including natural gas and gasoline, are still behind Bitcoin in reducing carbon emissions. Still, there is a need to control Bitcoin mining, and the authors believe that regulations can help control the situation and save the environment.