Bitcoin mining uses more electricity than most countries, according to a new report on its harmful environmental impact.
Mining is the process by which transactions are added to and verified on the blockchain for a public ledger. cryptocurrencies.
Competing miners compete to use computers to solve complex mathematical puzzles using extremely powerful techniques – earning new bitcoins for their efforts.
in 2020-2021, Bitcoin consumed 173.42 terawatt hours of electricity, which is enough to rank 27th among countries. Pakistan With a population of over 230 million.
The resulting carbon footprint was the equivalent of burning 84 billion pounds of coal.
To compensate for this, research united nations The university found that 3.9 billion trees would need to be planted, nearly equal to Netherlands, Switzerlandor Denmark.
Professor Kawe Madan said: “Technological innovations are often associated with unintended consequences.
“Bitcoin is no exception.”
What is authorized mining – and which countries lead?
Research by a UN team, published in the journal Earth's Future, found that Bitcoin mining relies heavily on fossil.
Coal made up 45% of its supply mix during the period, followed by natural gas at 21%.
Renewable energy sources such as solar and wind will provide a relatively small share of electricity generation between 2020 and 2021.
But organizations including the Bitcoin Mining Council — which represents 43% of miners worldwide — say the energy-intensive process has since become more environmentally friendly.
Its figures suggest that 59.9% of the electricity used by its members came from sustainable sources in the first six months of 2023. However, these figures are difficult to verify and represent only less than half of the total network.
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During the UN study in 2021, China used to be the largest bitcoin mining country – but has since been overtaken by the US after Beijing began aggressively cracking down on the practice.
Together, the 10 countries that mined the most bitcoins were responsible for 92% of the climate footprint.
“Our findings should not hinder the use of digital currencies,” added Professor Madan.
“Instead, they should encourage us to invest in regulatory interventions and technological advances that improve the efficiency of the global financial system without harming the environment.”
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Are there alternatives?
Some blockchains have already moved away from mining in favor of greener alternatives.
The Ethereum network – the second largest after Bitcoin – made miners obsolete in September 2022 after an ambitious upgrade.
Instead, new transactions are approved by people who voluntarily block their cryptocurrency – and according to the Ethereum Foundation, this approach consumes 99% less energy.
Greenpeace has been lobbying for Bitcoin miners to follow suit, but its plea has fallen on deaf ears.