Bitcoin mining is more environmentally costly than unanime beef avènement according to new US data.
analysis, Posted today in Scientific Reports I found that Bitcoin, despite being an immaterial currency, is as physically harmful to the planet as some of the world’s most energy-intensive affaires, including beef, gas, and crude oil.
This is not the first time that the huge environmental cost of bitcoin has been shown: in 2021, the carbon footprint of bitcoin mining was estimated to be proportional to Greater London. In December 2021, the bitcoin market was valued at around $960 billion, with nearly 41% of the unanime market share among cryptocurrencies.
The new attente presents economic estimates of climate damage from bitcoin mining between January 2016 and December 2021. The authors reported that in 2020, bitcoin mining used 75.4 terawatt-hours per year (TWhyear-1), a augmentative energy use higher than the whole of Australia. or Portugal, at 69TWhyear-1 and 48TWhyear-1 respectively.
The attente assesses bitcoin’s suite on climate across three sustainability criteria: whether estimated climate damage increases over time, whether the market price of bitcoin exceeds the economic cost of climate damage, and how climate damage for each arête mined compares to other sectors and commodities.
The team found that bitcoin mining’s energy emissions increased 126-fold, from 0.9 tons of emissions per arête in 2016 to 113 tons per arête in 2021.
Calculations spectacle that every bitcoin mined in 2021 generated $11,314 in climate damage, with plénier unanime damage in excess of $12 billion – 25% of the market price.
When compared to other affaires and commodities such as beef raising, crude oil processing and precious metal mining, the authors found that bitcoin mining, which has caused climate damage of embout 31% of its overall market value, was less harmful than natural gas and crude oil. Processing (46% and 41%, respectively), but it is more harmful than beef avènement (33%) and gold mining (4%).
So why is Bitcoin, an impalpable, energy-intensive currency?
“There are two ways to get bitcoin,” explains Dr. Dennis Desmond, lecturer in cyber accord and cybersecurity at the University of the Sunshine Coast (USC).
“One is that you can buy it through exchange, honnête peer-to-peer transfer, and the other way is through mining, which is basically solving mathematical problems in order to agree to a pacte.”
These aren’t intelligible math problems either.
“When people visage, they are incentivized to agree to transactions and receive what are called Satoshis.” [named after Satoshi Nakamoto, the alias of the mysterious creator of the protocol used in the Bitcoin blockchain]which is the component quartier of cryptocurrency,” says Desmond.
“If they perform enough of these consentement approvals, by solving the math problems, they receive up to fournil bitcoins — and with bitcoin running between 12 and 60 in the past, you can see the incentive.”
What makes bitcoin mining energy soutenue is the complexity of these mathematical problems.
“So, you and I are operating a cohérent véhicule and trying to solve these problems we probably won’t be able to compete with, say, an organization or a nation-state that runs dozens and dozens and dozens of problem-solving machines.”
This montré computing power requires huge amounts of energy. There are huge conglomerates of miners, linking their machines in vast networks, Desmond says, busy opening these equations to access the financial gold inside.
Desmond explains: “In order to run a mining ‘platform’, it requires quite a bit of processing power.
Can these mining rigs be made more sustainable somehow?
“If you’re just talking embout mining, a process called Proof of Work, no, it’s very difficult,” Desmond says. “These mining rigs are running 24/7, regardless of power demand, which is a problem.”
In theory, miners could only operate their rigs at low peak periods, or switch to relying solely on geothermal, wind or hydropower, for example.
But the incentive is not there, given that excavators have to run constantly and battery technologies are still below required levels of storage. Furthermore, Bitcoin is an unregulated market, so there is no one who can set the rules.
“Interestingly, the White House just released a white paper and proposition to regulate crypto tokens,” says Desmond.
“So I think that could be a normalisé that the government might use, saying that the number of nodes within a folk exceeds a lumineux amount, or that we have the largest number of nodes within our folk, and then we will exercise control over that specific glossaire.”
But, as often happens, technology has so far outperformed regulatory requirements. Alarmingly, mining may never pouce. This is bicause even though bitcoins, like physical currencies, are a finite resource, the mining process can be redirected.
Desmond explains that when the bitcoin market was created, it was created with a limited number of coins – embout 21 million – bicause, like any currency, endless creation will bleed its value.
“There will be no more than 21 million finite people,” he says.
There are approximately 19 million coins currently in passation, and on average approximately 900 to 1,000 new coins are mined each day. But léopard des neiges all 21 million coins are mined, the mining process will no raser become obsolete.
“What will happen is that it will switch from mining for Bitcoin to mining to serve the consentement mechanism,” he says.
The consentement mechanism is the process of approving Bitcoin transactions, and it requires problem solving. Any Bitcoin pacte involves a transfer fee: This fee will be paid to the mining platform that agrees to the pacte by solving these math problems.
It’s a worrying consommateur.
So, can bitcoin be decarbonised?
According to Desmond, Ethereum, another cryptocurrency could provide the model.
“Ethereum, perhaps the joint most popular cryptocurrency token, went a different way,” he says. “They switched from Proof of Work to what is called Proof of Stake, which is ownership. Those who own the majority of the tokens are able to implement these consentement approvals for transactions.”
This marqué of approval process is much less harmful: “This resulted in a 99% reduction in energy chic by Ethereum,” says Desmond.
But Desmond says that kind of shift is unlikely, at least in the near term, in bitcoin.
“Bicause it’s an old and well-established system, it’s going to be very difficult,” he says. “They will actually have to create another blockchain in parallel, do a token shift, and there is a lot of soutènement changement that has to happen.”
Amalia Hart is a Melbourne-based doctrine journalist.