Guest essay by Eric Worrall
Will Silicon Valley give up its energy intensive cryptocurrency to save the planet?
Bitcoin Mining Alone Could Raise Global Temperatures Above Critical Limit By 2033
By Daniel Oberhaus
Oct 30 2018, 2:02am
A recent UN climate report said that if global temperatures rose above 1.5 C it could lead to catastrophic climate change. Bitcoin alone could raise global temperatures by 2 C within two decades.
Bitcoin requires massive amounts of energy to run the computers that secure the record of transactions that have occurred on the network, which are stored in a digital ledger called a blockchain. Each computer is simultaneously searching for the solution to a complex math problem—a process known as mining since the first computer to solve the problem is rewarded with newly-minted Bitcoin.
Bitcoin’s environmental footprint has been a serious point of criticism for years, mostly thanks to the work of the Dutch economist Alex de Vries. De Vries’ work has long lived on his blog Digiconomist, and more recently in Joule, a peer-reviewed academic journal. As Motherboard has previously reported, de Vries’ research has found that Bitcoin’s energy consumption likely roughly equivalent to the energy needs of Austria and may be more resource intensive than mining gold.
Yet even de Vries was surprised by the new research, which suggests that Bitcoin’s success could mean bad news for everyone on Earth.
From the study;
Globally, ~314.2 billion cashless transactions are carried out every year, of which Bitcoin’s share was ~0.033% in 20175. The environmental concern regarding Bitcoin usage arises from the large carbon footprint for such a small share of global cashless transactions, and the potential for it to be more broadly used under current technologies. Bitcoin usage has experienced an accelerated growth (Supplementary Fig. 1), which is a common pattern during the early adoption of broadly used technologies8. Should Bitcoin follow the median growth trend observed in the adoption of several other technologies (Fig. 1b), it could equal the global total of cashless transactions in under 100 years. Yet, the cumulative emissions of such usage growth could fall within the range of emissions likely to warm the planet by 2 °C within only 16 years (red line in Fig. 1b). The cumulative emissions of Bitcoin usage will cross the 2 °C threshold within 22 years if the current rate is similar to some of the slowest broadly adopted technologies, or within 11 years if adopted at the fastest rate at which other technologies have been incorporated (that is, the red area in Fig. 1b). Projections in this analysis assume that the portfolio of fuel types used to generate electricity remains fixed at today’s values (see Supplementary Table 3).
Note: The full study is available without paywall by clicking the link to the study from the Vice article.
Studying the imaginary climate impact of a fantasy digital currency in my opinion is the modern equivalent of arguing about how many angels can dance on the head of a pin – though it is entertaining to see green bitcoin enthusiasts defend their actions.
One point of interest is that this climate catastrophe is predicted to occur even if Bitcoin continues to make efforts to source their electricity from renewables. Though I doubt in practice whether Bitcoin will actually grow to consume such vast amounts of electricity, unless consumer electricity bills in climate obsessed countries come way down.