Climate change scientists have expressed alarm over the Bitcoin’s carbon footprint, and its future potential impact on global warming, according to a recent report published on Nature.com.
The report infers existing data for Bitcoin’s electricity consumption combined with various projections for the cryptocurrency’s adoption in coming years.
According to the report, last year, out of approximately 314.2 billion cashless transactions, Bitcoin’s share is estimated to have been around 0.033%. While acknowledging that “accelerated growth” is common at the early adoption stage of new technologies, the report nonetheless claims that even if Bitcoin follows a lower-level “median growth trend,” it could come to equal the worldwide total of cashless transactions “in under 100 years.”
Should this materialise, total emissions of Bitcoin usage would “cross the 2 degree Celsius threshold within 22 years” if its adoption rate is similar to some of “the slowest broadly adopted technologies,” or within just “11 years” if adopted at the fastest rate of adoption. The carbon footprint forecast assumption is that the fuel types used to generate power today will remain “relatively fixed” in future years.
“60 percent of the economic return of the Bitcoin transaction verification process goes to electricity, at $0.05 per kWh and 0.7 kg of carbon dioxide-equivalent (CO2e) emitted per kWh, [resulting in an] estimate that Bitcoin usage emits 33.5 metric tons of CO2e annually, as of May 2018.”
Scientists suggest that economic reasons will urge miners to switch to areas with cost effective power supplies, thereby proposing that “electricity decarbonisation could help to decrease Bitcoin’s carbon footprint — but only where the cost of electricity from renewable sources is cheaper than fossil fuels.”
The report admits that if energy costs remain high, more efficient hardware may help reduce its footprint, but it advises against relying on “yet-to-be-developed hardware.” A different proposal states “simple modifications to the overall system, such as adding more transactions per block or decreasing the difficulty or time required to resolve the proof-of-work” in order to “immediately” reduce Bitcoin’s electricity consumption.
However, not all energy experts concur with the shared belief that high energy consumption is Bitcoin’s kryptonite. A report published in August critically examined the exclusive focus on mining’s energy-intensivity, emphasizing the importance of where the energy is produced and how it is generated, countering that “electricity production can increase while still maintaining a minimal impact on the environment.”
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