Cryptocurrency is one of the fastest financial industries in the world. And with all of that attention, it has certainly been at the center of a multitude of debates. People have talked about its benefits, ethics, disadvantages, and a variety of other areas that surround it.
However, only now have people started talking about the very real environmental cost that crypto mining has. And while you might not think it’s a lot, it is significantly worse than you can imagine; especially when considering Bitcoin.
Mining is the process of acquiring cryptocurrency and happens to be one of the most profitable industries today. But to mine specific crypto, computers will have a series of algorithms. And the higher the price for crypto, the more time it will usually take to crack the code. Therefore, miners require a lot of electricity to mine crypto effectively. And that is where the problem lies.
Theoretically, crypto mining can have no carbon footprint if the miner is in a country where electricity is made through renewable sources. However, that is a rare occurrence. Even countries like China, which make most of their cheap electricity through dams, still rely on fossil fuels. So with the amount of electricity that it needs, and the way most countries produce electricity, mining can have a massive carbon footprint.
Every year, Bitcoin mining alone can take up to 91 terra-watt hours worth of electricity alone. For reference, the 5.5 million residents of Finland and the 45 million residents of Argentina use less electricity than that in a year. Only through reference have some people been able to come to grips with the fact that mining has a serious carbon footprint.
Moreover, even Elon Musk, one of the biggest supporters of the crypto market, has brought attention to its environmental damage. In fact, Musk has been at the forefront to reduce the world’s carbon footprint and by extension cryptocurrency. He even stopped accepting Bitcoin as tender for his Tesla car after he learned about the very serious environmental consequences of using and promoting Bitcoin.
China, in an effort to reduce its carbon footprint, has decided to outlaw crypto mining entirely. While many have called into question the motivation behind this decision, others believe that it doesn’t matter. Even if china reduces its own carbon footprint, these miners will simply go to other countries and set up shop. Therefore, it will not reduce the global outcome.
Of course, this is not the end for crypto. Cryptocurrency mining can still thrive if it makes use of more renewable energy sources. If they do make use of these environmentally friendly sources, they can continue to operate without a hitch.
