A new report from CoinShares says that Bitcoin mining is much more environmentally-friendly than is normally reported.
The usual narrative applied to cryptocurrency mining is that it’s very energy-intensive and damaging to the natural environment. Critics say that the increasing power consumed by mining outfits will lead to disastrous consequences in the future. It is also pointed out in most media stories that 5 million homes can be powered with what crypto miners consume. However, a new study says we should put a brake on such notions.
Bitcoin Mining Not Draining the Planet’s Power Dry
Researchers from CoinShares, a digital asset firm, have released a new study called “The Bitcoin Mining Network” that takes a critical look at cryptocurrency mining and its environmental impact. They note that the perception that miners are taking too much power is entirely misplaced.
The researchers (Christopher Bendiksen, Samuel Gibbons, and Eugene Lim) say:
“We keep stressing these facts because the common public narrative surrounding the environmental impact of cryptocurrency mining is overwhelmingly negative.
“Our view is that cryptocurrency mining — while costly — is doing little meaningful harm as far as the environment is concerned, and is also unlikely to do so in the foreseeable future.”
Crypto Mining in China is Not the End of the World
The researchers note that over two-thirds (77.6%) of crypto miners use renewable energy to power their operations. They also point out that almost half of all bitcoins are mined in Sichuan, China, where 90% of all the generated power comes from renewable sources. They also note that the vast majority of locations where crypto is mined in China takes place in regions that are predominantly cool, thus reducing the need for additional power to keep the mining rigs cool and running.
Another point of consideration is that miners flock to areas around the world that boast cooler climates and renewable energy sources, which means cheap power and lower operational costs. Such locations include Iceland, the Pacific Northwest, and Scandinavian countries.
It should be noted that the hysteria over power consumption is just that – hysteria. There’s no finite amount of power that, once used, will be gone forever. More oil and natural gas are being found every day, nuclear power offers tremendous energy output, and renewable energy sources are becoming more efficient as time goes by.
Another factor that is often ignored when it comes to Bitcoin mining is the addition to the overall global economy. Fadi Aboualfa, head of research at Diar, says:
“I think it’s very important to emphasize that there is a philosophical question in play regarding energy use and bitcoin’s independence from third parties as part of a system that can transfer value.”
Finally, it should be considered that the power consumed by Bitcoin mining pales in comparison to other industries, such as banking or the mining of gold.
Do you think the environmental impact of cryptocurrency mining is overblown? Let us know in the comments below.
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