US Research: Bitcoin is Not Getting Greener, on the Contrary

Bitcoin is sometimes called the new digital gold, but digital oil would be a better term to describe its environmental impact, according to a study in Scientific Reports.

According to that research, Bitcoin’s ecological footprint has increased significantly since 2016. Unfortunately, the coin sometimes creates more damage than it is worth.

Bitcoin’s climate damage averaged 35 percent of its market value between 2016 and 2021. That is a lot more than that of gold (4 percent). On the other hand, it is closer to that of gasoline from oil (41 percent), electricity from natural gas (46 percent) or beef (33 percent).

The damage to the environment and climate is so great that it sometimes exceeds the currency’s value. “We find several cases between 2016-2021 where Bitcoin is more damaging to the climate than a single Bitcoin is actually worth,” said Benjamin Jones, a professor of economics at the University of New Mexico in the US. ‘That is extremely disturbing from a sustainability point of view.’

Jones and his colleagues calculated that Bitcoin mining used 75.4 terawatt hours of electricity in 2020 — more than countries like Austria (69.9 TWh) or Portugal (48.4 TWh) that year.

Moreover, the technology’s climate footprint does not appear to be shrinking, as the sector claims; quite the contrary. Instead, the study finds that CO2 emissions from Bitcoin mining power production have skyrocketed, from 0.9 tons per coin in 2016 to 113 tons in 2021.

“We find no evidence that Bitcoin mining is becoming more sustainable over time,” Jones says. Rather, our results show the opposite: Bitcoin mining is getting dirtier and more damaging to the climate. In short, Bitcoin’s ecological footprint is heading in the wrong direction.”

The scientists argue in favour of switching the technology to more sustainable alternatives. For example, instead of creating bitcoins with the energy-hungry proof of work concept, you can opt for proof of stake, which is up to 99 percent more efficient because it requires much less computer power.

Cryptocurrency Ethereum recently made the turnaround. However, they say that if Bitcoin doesn’t follow suit, stricter regulations may be needed to contain the climate footprint.

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