Coal still most popular source for bitcoin mining, but use is declining

A research from the Cambridge Center for Alternative Finance (CCAF) revealed big news about the bitcoin (BTC) mining sector on Tuesday. According to the research, the ‘electricity mix’ for bitcoin mining has been changing in recent years.

Fossil fuels in bitcoin mining

At the beginning of this year, 62% of the electricity for bitcoin mining was produced by the fossil fuels coal and gas, according to the research. 38% came from sustainable sources.

Coal is still at the top when it comes to the largest source of energy for bitcoin mining. Of all bitcoins, 37% is mined with electricity generated by coal. This is mainly because countries with a large bitcoin mining sector such as Kazakhstan are very dependent on fossil fuels.

Despite bitcoin’s heavy reliance on coal, there has been a decline. By 2021, 40% of all bitcoin was mined with electricity generated by burning coal.

Striking and less optimistic is the sharp decline in the share of hydroelectricity. 2022 saw a drop from 34% to 15% of the total from 2021. The reason for this is the Chinese crypto mining ban. Chinese law last year caused many mining farms that used hydroelectricity to shut down.

Relocation of bitcoin miners

The Chinese ban on crypto mining has negatively impacted the environmental impact of bitcoin mining, according to the study. Countries that mainly use fossil fuels for electricity have taken over China’s share of the bitcoin mining sector.

“The Chinese ban on crypto mining and the subsequent shift of bitcoin mining activity to other countries has negatively impacted the environmental footprint of bitcoin mining.”

According to the research, the growing share of gas and nuclear energy reflects a relocation of bitcoin mining to the United States. Gas and nuclear power both have large shares of US electricity production.

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Although bitcoin mining is often associated with pollution, mining can recent research important in the transition to sustainable electricity. Earlier today, Crypto Insiders reported that bitcoin mining accounts for 0.1% of global CO2 emissions, but this is also decreasing.

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