There is no doubt on how popular cryptocurrency of Bitcoin has become or the advantages it offers, but there is also a flip side. According to a recent study issued in the journal called Joule on 12th June, the amount of carbon emissions produced by Bitcoin (BTC) is comparable to the levels caused by Kansas City or even a compact nation.
Christian Stoll, a member of the research team that conducted the study, stated that participating in the validation and mining process of Bitcoin blockchain not just needs special hardware but also huge amounts of electricity. Such high levels of electricity then translate into the considerable carbon footprint. As noted by the study, the problem is only getting worse because the required computing power for solving a Bitcoin problem has not doubled but quadrupled since the previous year.
The study also added that the enormity that these carbon emissions possess together with the collision risk, as well as concerns about monetary system control might justify the regulatory intervention for protecting individuals from their own actions.
For the study, the research team utilized the IPO filings data of leading hardware manufacturers, mining pool compositions, and mining site operations insights. Then utilizing IP addresses’ localization, the researchers translated estimates of power consumption into the carbon emissions.
As per the research, Bitcoin’s yearly electricity consumption was determined to be about 45.8 TWh, as of last year’s November. That leads to the yearly carbon emission estimate to fall in the range of 22.0 – 22.9 MtCO2. Fascinatingly, this estimate indicates that the volume of emissions caused by Bitcoin falls between the amount produced by countries, such as Sri Lanka and Jordan. In addition to that, the study also advocated that the emission level would likely double if other digital currencies were also taken into consideration.
Stoll also highlighted the fact that such a huge emission of carbon by Bitcoin underlines the requirement for tackling the environmental externalities that result from cryptos. It also brings to light the essential need of blockchain apps’ general trade-offs with respect to costs and benefits. Continuing further, Stoll said that they don’t question the gains in terms of efficiency that the technology of blockchain could provide in specific cases. But the present debate is concentrated on the anticipated advantages, and increased attention is required to be channeled on costs.
Stoll also suggested that policy-makers should also consider aspects like Carbon, Concentration, Control, and other cryptos’ power consumptions as well.
Meanwhile, another study which was conducted in November last year revealed that it took four times more energy for mining 1 dollar of Bitcoin than it did to mine one dollar of copper. In fact, the energy BTC requires for mining is double of what is needed for mining 1 dollar of platinum or gold. The study reviewed the timeline starting from January 2016 till June 2018.