Bitcoin Could Rival Beef or Crude Oil in Environmental Impact
Carbon emissions from mining one coin increased 126-fold from 2016 to 2021, a new study finds
A worker installs a new row of bitcoin mining machines at the Whinstone US Bitcoin mining facility in Rockdale, Texas, the largest bitcoin-mining facility in North America.
Bitcoin mining is notoriously energy-intensive, but new research suggests it may contribute as much to climate change as the beef or crude oil industry, by one estimate. In a study published Thursday in Scientific Reports, researchers compared the approximate environmental cost of mining the digital currency to the impact of other industries and countries.
“Within the general public, I think a lot of people are still just grappling with what Bitcoin is,” Benjamin Jones, an environmental economist at the University of New Mexico and a co-author of the study, tells Popular Science’s Miyo McGinn. “But we need to be aware of the tremendous impact it has on the environment. It’s very damaging.”
Bitcoin mining is the process by which new currency enters into circulation and transactions are verified. This process requires specialized computers that solve complex math problems. The first miner to solve a given problem wins a predetermined amount of the digital coins, writes New Scientist’s Corryn Wetzel. The miners with the most powerful computers can make more guesses, allowing them to solve a problem more quickly and increase their chance of winning.
“Because it’s worth a lot of money, you have a lot of people who are engaging in this guessing game,” Jones tells New Scientist. “That’s using a lot of electricity, and most of that electricity is coming from fossil fuels.”
To calculate the impact of mining, the researchers looked at the number of bitcoins mined daily between 2016 and 2021. They considered the amount and type of energy the miners used, as well as their locations to estimate the emissions per coin, per New Scientist.
Using the social cost of carbon, a common metric to gauge the financial damages caused by the greenhouse gas, the researchers calculated the climate cost of Bitcoin. On average, they found that for each dollar in bitcoin value produced, the process resulted in 35 cents in global climate damages—or 35 percent of its market value. In comparison, beef’s climate damages clocked in at 33 percent of its market value, and damages from gasoline produced from crude oil were at 41 percent.
In May 2020, Bitcoin’s damages peaked at 156 percent of coin price, per the study.
“We find several instances between 2016-2021 where Bitcoin is more damaging to the climate than a single bitcoin is actually worth,” Jones says in a statement. “Put differently, Bitcoin mining, in some instances, creates climate damages in excess of a coin’s value. This is extremely troubling from a sustainability perspective.”
Carbon emissions for mining a single bitcoin rose from 0.9 tons in 2016 to 113 tons in 2021—a 126-fold increase. The industry’s annual carbon footprint is comparable to Greece’s, per Digiconomist. And in 2020, Bitcoin used 75.4 terawatt hours of electricity—more than Austria (69.9) or Portugal (48.4).
But the environmental impact of mining this cryptocurrency doesn’t just come from its emissions. “In addition to energy use, you have to consider hardware use and e-waste,” says Alex de Vries, a digital currencies researcher at the Vrije Universiteit Amsterdam in the Netherlands who was not involved with the new research, to Popular Science.
The equipment used for mining is highly specialized—it is only used to mine bitcoins, de Vries tells Popular Science. Therefore, the computing chips are obsolete within just a year and a half, then they become trash. A single Bitcoin transaction creates about 400 grams of e-waste, which equates to 2.44 iPhone 12 devices, according to Digiconomist, which de Vries founded.
“ devices end up in unknown locations for unknown amounts of time, potentially leaching toxic materials into the ground and water,” he tells Popular Science. “Or they’re thrown into an incinerator, and the toxic materials are released into the air.”
It is possible to produce cryptocurrency in a less energy-intensive way: Another popular cryptocurrency, Ethereum, made a change in September that was expected to cut its electricity use by 99 percent. Jones tells New Scientist he hopes that Bitcoin will make a similar move.
For the time being, though, the climate impact of mining these coins remains high. The authors write that their results raise a “set of sustainability red flags.” Bitcoin proponents have called the virtual currency “digital gold.” But “from a climate damages perspective,” write the authors, “it operates more like ‘digital crude.’”
https://www.smithsonianmag.com/smart-news/bitcoin-could-rival-beef-or-crude-oil-in-environmental-impact-180980877/