Bitcoin mining has an environmental impact on a par with the most polluting activities on the planet. This is the conclusion of a new study published in the journal Nature. It is one of the most complete reports to date, where data between 2016 and 2021 has been analyzed and a reality that we have been warning about for years has been verified.
More polluting than oil extraction. In 2020 alone, Bitcoin mining consumed 75.4 TWh of electricity per year, more than countries like Austria or Portugal. The trend is that Bitcoin has been polluting more and more, going from 0.9 tons of CO2 to 113 tons last year. A 126-fold increase in your lifespan.
To get an idea, the researchers explain that for each equivalent of one dollar generated in BTC, 35 cents represented environmental damage. It is a huge amount for an activity, on a par with gasoline or meat production and almost as much as natural gas. When talking about highly polluting activities, Bitcoin is hardly ever mentioned, but this study certifies that we should start including it.
Unrestricted emissions. Another concern of the authors is that emissions have been growing year after year. It was expected that with the maturity of Bitcoin emissions would moderate, but this has not been the case. Only China’s ban on Bitcoin mining had an effect in reducing emissions.
If the defenders of BTC spoke of this cryptocurrency as “digital gold”, the truth is that it has ended up becoming a kind of “digital oil”. An entity of high value but with a very serious environmental impact. While the production of gold has an impact of 4% according to its value, Bitcoin on average is at 35%. Similar to gasoline (41%) or beef production (33%).
1 BTC = $11,314 of weather damage. According to the calculation of the study, in 2021 for each bitcoin generated, about 11,000 euros were produced in environmental damage. To get an idea, this represents a total of 3.7 billion dollars in damage to nature. Only in 2021. If we look back, it supposes that Bitcoin has caused a damage of 12,000 million dollars.
It became almost as polluting as coal. The last mining boom was a real environmental hole. The impact of Bitcoin reached insane levels, similar to that of coal. At that point in May 2020, Bitcoin’s shock completely exceeded its own value. To the point that for every dollar generated, $1.56 in environmental damage was created. 156%.
The future is very uncertain despite the promises. The study also talks about the use of renewable energy for Bitcoin mining. However, she is quite skeptical about its ultimate impact. Even in an optimistic scenario where the use of renewable energy is increased by 50%, the impact of Bitcoin would still be 23% of the value of the currency.
Organizations in favor of cryptocurrencies advocate profound changes in their code, to reduce their consumption. This is what we have seen with Ethereum 2.0, where a 99.95% drawdown is promised. We will have to wait for these improvements to also reach Bitcoin. What we have at the moment is that Bitcoin has already left a tremendous environmental impact in its short lifetime.
Image | Jernej Furman
George is Digismak’s reported cum editor with 13 years of experience in Journalism