Bitcoin harms the climate more than a single Bitcoin is worth
Cryptocurrencies are among the major climate changers – this is the conclusion of a new study by the University of New Mexico in Albuquerque (USA). Mining is also becoming more and more harmful to the climate, as more and more resources are needed.
Therefore, according to the researchers, Bitcoin and others should be put on the same level as the production of energy-intensive products such as beef, natural gas, and crude oil. So far, however, Bitcoin has been compared much more to the mining of gold, but that is completely wrong when it comes to the effect that mining has on the climate.
We find no evidence that Bitcoin mining is becoming more sustainable over time, said Benjamin A. Jones, associate professor of economics at UNM. Our results tend to suggest the opposite: Bitcoin mining is becoming dirtier and more climate-damaging over time. In short, Bitcoin’s ecological footprint is moving in the wrong direction.
As of December 2021, Bitcoin had a market capitalization of around $960 billion and a global market share of around 41 percent among cryptocurrencies. Although it is known that Bitcoin is energy-intensive, the extent of the climate damage caused by Bitcoin is so far unclear.
More power consumption than Austria
Jones and his colleagues Robert Berrens and Andrew Goodkind present economic estimates of the climate damage caused by Bitcoin mining between January 2016 and December 2021. They report that Bitcoin mining used 75.4 terawatt hours of electricity (TWh) in 2020 – a higher electricity consumption than Austria (69.9 TWh) or Portugal (48.4 TWh) this year. “Globally, mining and/or producing Bitcoin consumes enormous amounts of electricity, most of which comes from fossil fuels such as coal and natural gas.
This causes enormous amounts of air pollution and carbon emissions, which have a negative impact on our global climate and health.”, according to Jones. We found several cases between 2016 and 2021 where bitcoin does more climate damage than a single bitcoin is actually worth. In other words, bitcoin mining causes climate damage in some cases that exceed the value of a coin. This overview of sustainability is extremely worrying.
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