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    Researchers Criticise Bitcoin’s Impact On Climate

    Mayank Majila
    Sept 30, 2022 14:36
    The Bitcoin bashing continued even in the depths of a bear market. As more research comes up, the question of Bitcoin’s energy usage and environmental impacts keeps arising.
    Researchers Criticise Bitcoin’s Impact On Climate

    The Bitcoin bashing continued even in the depths of a bear market. As more research comes up, the question of Bitcoin’s energy usage and environmental impacts keeps arising. Researchers in the department of economics at the University of New Mexico published the latest paper on Sept. 29. 

    They alleged Bitcoin that from a climate-damage perspective, it is operating more like digital crude than digital gold. 

    Research & Data

    The research estimates the energy consumption and climate damage caused by proof-of-work (PoW) Bitcoin mining. And it further compares it to other industries. As per the report, between 2016 and 2021 - $1.00 in Bitcoin in the market was responsible for close to $0.35 in global climate damage. 

    Researchers concluded if Bitcoin switches to a proof of stake mechanism to become sustainable, it is unlikely to become sustainable. 

    The research team said, “If the industry doesn’t shift its production towards proof of stake, Bitcoin and other digital assets will have to be regulated. And over that, a delay is likely to increase damage to the global climate.

    The founder of Australian-based blockchain development agency Labrys, Lachlan Feeney, said after the Merge, Bitcoin has been facing immense pressure to justify the proof of work system and eventually shift to it. 

    However, the University of Cambridge was ready with arguments and counter-comparisons. In their report, they argued that Bitcoin currently consumes over 94 terawatt hours (TWh) of energy per year. To put this into context, if we combine all the refrigerators in the U.S. alone, they consume more power than the entire Bitcoin network in a year.

    Also, the transmission and distribution of electricity losses in the country are close to 206 TWh per year. This much power consumption could power the Bitcoin network 2.2 times over. Cambridge University’s report further explains how t the Bitcoin network power demand decreased by 28% since mid of June. This is because of miner capitulations during the bear market phase and the adoption of more efficient mining hardwares.

    The argument further stipulates that mining can carry out renewable energy, sources in the U.S. With this happening, the world has seen an influx of mining firms since China’s ban on crypto. 

    What The Experts Has To Say?

    Michael Saylor, the former MicroStrategy CEO, tweeted to slam misinformation and propaganda spread regarding Bitcoin and its efficiency. He showed metrics and data to wipe off the opposing arguments. He revealed that 60% of the energy for Bitcoin mining comes from sustainable sources. And the network is improving its energy efficiency by 46% year-on-year.

    In recent years, Texas has become the mining Mecca. It is an example to show renewables can reign. Texas has become the largest producer of wind power in the U.S. The state has been establishing mining fields to use excess energy. In August, reports revealed that the sustainable energy for Bitcoin mining has grown by 60% in the last year. 

    So, it can all be gloom or doom.