Bitcoin mining has negligible impact on climate change, study shows

Recently, it was reported that Bitcoin mining currently consumes a quarter of the world’s electricity supply, which is the same as or more than many small countries.

However, according to a new study, actual carbon emissions and impacts on climate change are not as negative as previously believed.

Bitcoin mining emissions aren't as bad as thought

Bitcoin's blockchain network is secured and verified through a process called proof of work, where miners use powerful computer processing power to solve complex mathematical equations. To solve these mathematical equations, specially designed computers consume large amounts of electricity. Miners are rewarded for their time, effort, and expensive electricity, and receive a certain number of Bitcoins (currently 12.5 BTC) for each new block produced.

As time goes by, mining difficulty increases, requiring more and more energy supply. At the same time, the rewards miners receive for their efforts are reduced with each scheduled halving, a pre-coded event in which the rewards miners receive are reduced by half.

At the same time, as BTC revenue decreases over time, but energy demand continues to rise, there has been concern about Bitcoin's overall impact on the climate. However, a new study shows that Bitcoin's impact on climate change is far smaller than once thought.

Past studies have suggested that emissions from Bitcoin mining, where computing power is used to solve math problems to create new currencies, could be as high as 63 megatons of carbon dioxide per year. Some researchers have even claimed that cryptocurrency alone could undermine global climate goals.

China accounts for 47% of crypto assets’ carbon emissions

Recently, Susanne Köhler and Massimo Pizzol of Aalborg University in Denmark claimed that the data used by previous studies assumed that China’s electricity generation (which accounts for half of all Bitcoin mining due to lower energy costs) was the same.

But the new study breaks down emissions within China to a regional level, showing a much lower figure of 17 megatons of CO2. Previous research pegged emissions to Bitcoin at nearly four times that amount, at 63 megatons of CO2 per year.

For example, hydropower in China’s Sichuan province helps lower overall emissions, while coal-based energy in Inner Mongolia significantly increases emissions. Overall, from a global perspective, China alone accounts for 47% of all Bitcoin’s carbon emissions. Canada, Russia, and the United States follow as the leading global sources of Bitcoin-related emissions.

The study further states that it is almost entirely electricity used to mine Bitcoin that makes up emissions, with the production and disposal of mining equipment accounting for just 1% of Bitcoin’s total emissions.

Because Bitcoin mining is decentralized and spread out around the world, Kohler and Pizzol said it’s difficult to get an accurate picture of its emissions, and more data is needed to truly understand its impact on climate change.

With the crypto asset’s network only growing, mining difficulty increasing, and energy consumption only growing, the discussion about Bitcoin’s impact on climate change is likely to continue for the foreseeable future.

The original text comes from newscientist&newsbtc, translated by the Bluemountain Labs team. The English copyright belongs to the original author. Please contact the translator for Chinese reprint.