The environmental and social damage that bitcoin inflicts on the world is comparable to that of notoriously polluting industries like beef production and crude oil being burned for gasoline, according to a new study published today in the journal Scientific Reports. According to the researchers, bitcoin should be thought of as the “digital bully,” as opposed to the moniker “digital gold” that enthusiasts like to use for cryptocurrencies. The study, conducted over a period of five years, examined the carbon dioxide emissions associated with the use of bitcoin and the monetary value of the climate damage it has caused. The researchers also found that the continued use of Bitcoin in its current form was disastrous and would cause irreparable social and environmental damage in the future.
Climate damage caused by bitcoin
The researchers found that during the period of their study, the carbon emissions of a single bitcoin unit increased from less than one tonne (metric ton) to 113 tonnes (124 metric tons). According to the researchers’ analyses, each bitcoin mined in 2021 caused climate damage of approximately 11,315 US dollars. If we consider all these figures, climate damage would amount to more than 3.7 billion dollars for this year alone.
To put this figure in perspective with other environmentally unfriendly activities, the researchers converted the damage to a percentage of the market value of bitcoins, which amounts to 35%. This means that for every US dollar worth of bitcoin, 35 cents represents climate damage.
By comparison, the climate damage of natural gas is 46 cents, while that of gasoline produced from crude oil is 41 cents. Bitcoin’s climate damage is worse than that of cattle ranching, which is valued at 33 cents, and much worse than that of gold mining, which is estimated at four cents. When it comes to their economic value and environmental impact, bitcoins are sometimes compared (albeit questionably) to gold. This new study reveals that the climate damage caused by bitcoin was actually 8.75 times greater than that caused by gold. Compared to gold mining, bitcoin’s share of climate damage is almost an order of magnitude higher, said study co-author Andrew Goodkind, assistant professor of economics at the University of New Mexico. .
So what exactly is climate damage?
To estimate the dollar cost of future damage to the planet from climate change, the researchers used a key metric used in policy-making. The researchers looked at the “social cost of carbon”, which takes into account things like agricultural and labor productivity losses and the destruction caused by rising sea levels. Researchers use climate models and other data to calculate the amount of damage (in dollars) that might be caused by each additional ton of carbon dioxide released into the atmosphere.
The Bitcoin network is infamous for its annual electricity consumption equivalent to that of a small nation. The vast majority of energy is used to verify transactions and “mine” new coins. The authors of the study estimated the overall electricity consumption of the network and the planet-heating carbon dioxide emissions it generates as a result. They then applied estimates of the social cost of carbon to translate these CO2 emissions into financial damages. With a social cost of carbon of $100 per ton, the researchers found that climate damage amounted to an average of $3,088 for every coin mined. Between 2016 and 2021, researchers estimate that the total climate damage caused by bitcoin globally reached $12 billion.
The caveat is that the amount of the social cost of carbon per tonne is still much debated. Taking $100 per ton as a benchmark, the researchers took a middle-of-the-road approach. The US government, for example, sets the social cost of carbon at $51 per tonne when developing pollution regulations – a figure that many experts consider too low. A study published in the journal Nature earlier this month put the cost at $185 per ton.
Regardless, the researchers point out that the climate damage caused by bitcoin has increased over time, whether one uses low or high estimates of the social cost of carbon. Their findings follow other efforts to quantify the damage caused to the plant by bitcoin mining. According to a September report from the White House Office of Science and Technology Policy, energy-intensive cryptocurrencies are responsible for as much annual pollution to the planet as all of the diesel fuel used by railroads. national iron. Another report published in September by environmental groups Earthjustice and Sierra Club comes to a similar conclusion: Cryptocurrency mining releases around 27.4 million tonnes of CO2 in one year, three times more than the pollution generated by mining. largest coal-fired plant in the United States in 2021.
As pressure mounts to clean up the cryptocurrency industry, bitcoin is now an exception when it comes to its environmental impact. Its closest rival, Ethereum, recently performed a major software update to drastically reduce its power consumption in a highly anticipated event called The Merge. Goodkind sees this as an example of potential solutions to make cryptocurrencies more sustainable. If bitcoin made a similar update, the climate damage estimated in this work would likely become negligible,” the study says.
Source : Nature.com
And you?
What is your opinion on the subject?
What do you think of cryptocurrencies in general and bitcoin in particular?
Do you hold any assets or do you intend to dispose of them?
See as well :
Europe must ban Bitcoin mining to meet 1.5C Paris climate target, say Swedish regulators
Global warming: Bitcoin might lead us to chaos in 20 years by raising the global temperature beyond the critical limit
The fall in the price of bitcoin forces miners to leave the network, good news for the environment and the climate?
Carbon emissions from bitcoin mining in China will reach 130 million tons by 2024, undermining the country’s climate action
Bill Gates Says Bitcoin Is Bad For The Planet: It’s More Electricity Per Transaction Than Any Method Known To Mankind, It’s Not Good For The Climate
