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Bitcoin is one of many encrypted digital currencies. They are considered a promising alternative to existing monetary systems. However, the “queen of cryptocurrencies” suffers from one flaw: Bitcoin’s environmental balance is deplorable.
Bitcoin production is extremely energy-intensive. If you look at the computing power required by the Bitcoin blockchain today, the energy consumption is higher than ever before.
To create new Bitcoins, participants in the network must “dig” (mining) them. This means they must verify transactions on the blockchain by solving complex math problems. This requires enormous computing power. And this is responsible for the release of greenhouse gases. The electricity consumed by the algorithm is mostly produced from fossil fuels, namely CO.2 release.
Bitcoin consumes more electricity than the Netherlands
French comparison portal Selectra He estimates that Bitcoin’s energy consumption now exceeds that of the Netherlands. Swiss energy consumption is also lower than that from bitcoin. by bank America’s Buying one bitcoin for $50,000 (currently about $31,000) equates to CO2-270 tons output. A total of about 65 megatons of CO are used for bitcoins.2 pushed out This corresponds to CO2-Export from Greece.
In this way, Bitcoin contributes significantly to global air pollution and climate change. So much so that solutions to this problem are discussed. There are currently five solutions on the table.
Solution 1: Change the code
Among other things, climate activists advocate changing the mining process. They believe that because less computing power is required, changing the computer code can reduce the impact on the environment. However, this operation may reduce its security. Additionally, all Bitcoin miners will have to accept the new solution, which is far from guaranteed.
Solution 2: Renewable energies
Ludovic Thomas, COO of Prosperity Digital, explains: “Mining activities are increasingly being shifted to renewable energies.” More than half (56 percent) of the electricity used in mining already comes from renewable sources. In March 2021, this value was still 39.7 percent. As part of the Volcano Energy Project in El Salvador, one of the world’s largest Bitcoin mining facilities is currently being built using solar and wind energy sources. In addition, huge data centers have been built in countries that offer renewable energy sources, such as the USA. But Thomas warns: “Infrastructures of this size carry risks in the event of a natural disaster or regulatory change, as well as the risk of centralization.”
Solution 3: nuclear energy
Nuclear energy, which is often unwelcome, also helps. Nautilus will launch the first nuclear-powered bitcoin mine in the US this year.
Solution 4: Circular Economy
The latest approach: combining mining with other activities. Resource sharing provides a circular economy by using the same energy twice (electric to thermal).
Solution 5: Stop mining
A study by a Dutch hedge fund in March 2021 suggested stopping Bitcoin mining. Argument: It would be a waste of energy to go from the current 19 million bitcoins to the last 21 million bitcoins. According to study leader Bram Cornelisse, the number of bitcoins available does not matter to the price. For those who want a scarce asset and a clean environment, the answer in his research is: stop bitcoin mining!
This text was originally published on the Blick Romandie website.
Source :Blick
I’m Tim David and I work as an author for 24 Instant News, covering the Market section. With a Bachelor’s Degree in Journalism, my mission is to provide accurate, timely and insightful news coverage that helps our readers stay informed about the latest trends in the market. My writing style is focused on making complex economic topics easy to understand for everyone.
