How Cryptocurrency Mining Could Affect A Climate On Earth

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How Cryptocurrency Mining Could Effect A Climate On Earth

A recent UN report on climate change notes that with global warming at 1.5 ° C, irreversible climate change will occur throughout the world. Researchers at the University of Hawaii published yesterday (October 29, 2018) the results of their research: because of the mining of bitcoins alone, global warming by 2033 will exceed this critical one and a half-degree mark: it will add 2 ° C to global warming, thereby setting the beginning of “Global Warming 2.0”.

  • Extraction of bitcoins is accompanied by a huge expenditure of electricity, – for powering computing equipment, which provides accounting for bitcoin transactions.

In recent years, the “ecological footprint” of Bitcoin has been the subject of sharp criticism. In many ways – with the filing of a Dutch economist named Alex de Vries.

Frieze discovered that today the electricity consumption of bitcoin mining equipment is equivalent to the energy needs of all of Austria and is a more resource-intensive process than gold mining.

However, even Frieze was surprised by the results of research at the University of Hawaii, which suggests that the success of Bitcoin – for the inhabitants of the planet Earth will not end well. Everyone has long known that bitcoin mining equipment consumes electricity in extremely large volumes – but so far we have not had a clear picture of what the consequences are for the environment.

To obtain this clear picture, a group of researchers from the University of Hawaii gathered together information about the effectiveness of mining equipment for bitcoins, the most popular places for building trusses for mining bitcoins and the amount of carbon dioxide emissions that accompany the production of electricity – in these popular mining bitcoins places.

69 million tons of carbon dioxide for the year 2017 – only from mining bitcoins

Researchers at the University of Hawaii determined that last year, as a result of mining bitcoins, 69 million tons of carbon dioxide were emitted into the Earth’s atmosphere. This figure is slightly less than one percent of the total carbon dioxide emissions of all power plants on our planet, which, to put it mildly, is not small. Especially if you take into account the fact that bitcoin accounts for only 0.03% of all non-cash transactions of our planet.

  • To predict the ecological footprint that bitcoin will leave in the near future, researchers at the University of Hawaii have looked into history – to find out at what rates new technologies are usually spreading. As a result, they settled on two relatively young technologies: credit cards and dishwashers.

Why are researchers choosing these technologies? The first one (credit cards) is due to its incredibly fast distribution. The second (dishwashers) – because of its extremely slow spread.

Bitcoin adds 2 ° C to global warming in just 16 years

Researchers at the University of Hawaii have established that if the spread of bitcoin goes at an average rate (between these two technologies), the energy costs associated with this spread will lead to carbon dioxide emissions sufficient to warm the planet at 2 ° C in just 16 years.

  • On the other hand, even if the rate of spread is the slowest (as in the case of a dishwasher, for example), then a two-degree global warming will come a little later: not after 16 years, but after 22 years.

Researchers note: “We cannot predict the future of Bitcoin, but if it spreads even at the slowest pace (which we have seen when other technologies spread), then the global climate will not be good, as well as the people living on Earth.”

Maybe the solution is to use environmentally friendly ways to extract electricity?

It is important to note that in their forecast, the researchers proceed from the assumption that the ratio of the use of non-renewable and renewable energy sources (during the mining of bitcoins) will remain unchanged over the next two decades. The massive introduction of renewable energy sources around the world (if not for all industries, then at least for crypto-mining), can mitigate the negative consequences for climate. Plus, it is possible that such a development in which bitcoin will decrease in price to such an extent that its production will become unprofitable; then the problem will be solved by itself: Bitcoins will simply stop mining.

Traditionally, bitcoin farms are built in places with cheap electricity. As a rule, near the hydroelectric station. Most bitcoin farms are based in China. Sometimes these farms are so huge that they consume as much electricity as the city for which the power station is built.

As for environmentally friendly methods of producing electricity, the miners will adopt them only if the cost of the electricity they produce is less than the electricity they already consume. At the moment it is about several kopecks per kilowatt-hour. At the same time, although the price per kilowatt-hour for electricity produced by solar panels and windmills is rapidly falling, it will probably fall to an acceptable mark for miners after Bitcoin leaves an indelible mark in the climate of our planet: “Global warming 2.0”.