In writing the world’s most famous white paper, Satoshi Nakamoto defined Bitcoin (Bitcoin) The mining process. It is determined that the minting of new coins will be carried out through proof of work. In order to perform this verification and be able to mine cryptocurrency, computers need to solve complex mathematical calculations.
In the beginning, there were not many miners. However, this changed before the first Bitcoin bull market. The sharp increase in mining competition has led to a sharp increase in the cost of competitive machines. More importantly, the energy demand for new machines has skyrocketed-mainly for processing and cooling.
Eight years later, the energy demand for mining Bitcoin has increased-now it has reached 116.71 TWh per year. according to Data from the Cambridge Bitcoin Electricity Consumption Index or CBECI. At first glance, this seems a lot, right? But let’s take a closer look at the data to better understand the true impact of Bitcoin mining on the environment.
related: Ignore the headlines-Bitcoin mining is already greener than you think
Table of Contents
The use of energy in Bitcoin mining
Some influencers have recently appeared on social media and have linked Bitcoin to the alleged increase in the use of fossil fuel energy, especially coal. In fact, some countries, such as China, use coal as an important source of energy. But is this the main fuel for the energy used?
According to a study Publish Cambridge University September:
“Hydropower is listed as the number one energy source, and 62% of miners surveyed stated that their mining operations are powered by hydroelectric power. Other types of clean energy (such as wind and solar) rank lower, behind coal and natural gas , Accounting for 38% and 36% of the respondents’ energy respectively.”
In addition, according to CBECI, the world produces 25,082 TWh of energy annually. Only 20,863 TWh was consumed, which is 16.82% wasted. Bitcoin’s energy expenditure accounts for 0.47% of total energy production and only 0.54% of global energy waste.
Another survey recently released by Galaxy Digital Compare Bitcoin’s energy use Use banks and gold mining. According to the document, the gold industry uses 240.61 TWh per year, while the banking system uses 263.72 TWh.
More worrying is the situation regarding unused electronic equipment pointed out by CBECI. In the United States alone, due to the power consumed by unused connected devices in one year, it can power the Bitcoin network for almost two years.
Therefore, it is clear that compared to global energy production and waste, Bitcoin’s energy consumption is not as important as it says. Not to mention that this consumption of approximately 116 TWh is responsible for providing a safe and dignified life for millions of people around the world.
When talking about Bitcoin being green, what we should really pay attention to is its carbon footprint.
related: Is Bitcoin a waste of energy?The pros and cons of Bitcoin mining
Bitcoin’s carbon footprint
Unfortunately, most of the energy currently generated leads to a high carbon rate, which should be the main focus and focus when discussing the environmental impact of Bitcoin.
According to the information Released According to data released by the scientific journal Joule in 2019, Bitcoin’s carbon footprint is between 22 and 22.9 metric tons of carbon dioxide. This is indeed a relevant amount, comparable to the emission rates of Jordan or Sri Lanka.However, for example, it consumes much less energy than the U.S. military, according to data Compile 59 Mt CO2 is emitted by Statista.
Fortunately, there are some simple ways to offset the carbon footprint left by Bitcoin. With the tokenization of assets, some companies choose to tokenize carbon credits, making it easier for miners and all those who participate in the cryptocurrency industry in some way to mitigate the impact of electricity used by mining machines.
Looking to the future, our attention should be placed on reducing the use of fossil fuels to reduce the remaining carbon footprint.
It is worth noting that reducing the use of fossil fuels alone cannot solve environmental problems.more importantly optimization Use the generated energy while focusing on reducing any waste and unnecessary carbon emissions in the process.
related: The pandemic year ends with a tokenized carbon allowance and transaction solution
Develop green bitcoin
It is expected that the energy consumption of mining will not increase significantly in the next few years, because its correlation with computing power is more important than the adoption of Bitcoin itself. Therefore, 116.71 TWh should remain stable for a while.
In order to achieve the goal of a green Bitcoin network, crypto mining companies can do their part by purchasing carbon credit tokens and promoting production to reduce the use of fossil fuels. To say the least, it is unfair to accuse Bitcoin or miners of destroying the environment while turning a blind eye to 99.54% of other energy sources.
Bitcoin is open and can reach the end of the earth without restrictions or prohibitions imposed by third parties. It is important to remember that this cryptocurrency was created to provide a dignified life for ordinary and disadvantaged groups, prevent currency depreciation, guarantee purchasing power and improve the quality of life.
This article does not contain investment advice or recommendations. Every investment and trading action involves risks, and readers should research on their own when making a decision.
The views, thoughts, and opinions expressed here are only those of the author, and do not necessarily reflect or represent the views and opinions of Cointelegraph.
Hao Jie He is a technical veteran and an experienced industry leader. Before joining OKEx, he focused on blockchain-driven applications for real-time video streaming and mobile games. Before entering the blockchain industry, he has 21 years of solid experience in the semiconductor industry. He is also a recognized leader and has successful experience in product management. As the CEO of OKEx and a staunch supporter of blockchain technology, Jay foresaw that the technology will eliminate transaction barriers, improve efficiency and ultimately have a significant impact on the global economy.
