Bitcoin: not environmentally friendly technology
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As you may be aware, one of the most prevalent critiques leveled at Bitcoin and many other cryptocurrencies are that they are not especially environmentally friendly technologies. As blockchains grow in size and processing capacity to administer them and mine cryptocurrencies grows, so does the power consumption necessary for these operations.
This has resulted in the hunt for more efficient options in terms of the cost-consumption of electricity and resources related to cryptocurrencies, and there are already various projects where test systems have less influence in this regard. However, in those circumstances, we are discussing new cryptocurrencies or others that have had this type of transformation on their agenda for quite some time. This is not the situation with Bitcoin, which by definition is doomed to become more demanding in this regard with each passing day, until, if this increase continues, it becomes unsustainable.
Of course, one approach to attempt to offset the impact of Bitcoin at this point is to ensure that the vast majority of the electricity required for mining activities comes from non-polluting sources so that even with such high usage, it does not end up becoming a big source of pollution. And, despite the fact that we have just heard of some measures in this area, it does not appear that the situation has improved.
According to a study published in Joule, the trend would be exactly the opposite, with a significant fall in the quantity of "green" energy used around Bitcoin. And, while many will be shocked, the fundamental explanation for this can be found in China's policy to end Bitcoin mining in some of the country's regions, notably those where electricity is cheaper.
As we previously stated, Bitcoin mining was jeopardizing the Asian giant's CO2 emission targets, because the proliferation of macro-farms in the country depleted the production of hydroelectric facilities, forcing electricity company operators to rely on other sources, primarily coal, to sustain the volume of demand in these regions. In other words, "green" electricity was used to power Bitcoin mining in China in a big amount.
However, with the de facto expulsion of Bitcoin farms from China, their creators have looked to other parts of the world where the price of the electricity required for the farms keeps these facilities profitable, not to mention places where their arrival is encouraged through tax breaks and other similar measures. A diaspora with conflicting destinies such as the United States and Kazakhstan.
Specifically, the relocation of Bitcoin mining farms from China to the United States, supported by states such as Kentucky that have granted tax breaks, has resulted in an increase in the consumption of power derived from harmful sources, primarily charcoal. The same is true for Kazakhstan, which has relatively cheap electricity but is heavily reliant on coal.
According to this study, the impact of the move of Bitcoin farms from China would have resulted in a more than significant decline, as it fell from 41.6 percent of green energy utilized up to that point to 25.1 percent. A reduction of more than 15 points that, according to the researchers' estimations, suggests that Bitcoin's emissions currently outnumber those of Greece, with 65.4 megatons of CO2 per year from Bitcoin compared to Greece's 56.6 megatons of CO2 emissions in 2019.
Another fascinating comparison is that of the carbon footprint generated by each Bitcoin transaction, which the study estimates to be around 669 kilograms of CO2, an amount comparable to that of a round trip transoceanic flight, say, between London and New York, whose footprint is estimated to be around 670 kilos per passenger.