Researchers are increasingly concerned about the impact Bitcoin mining has on the climate. In a study by the University of New Mexico, it is written that the climate damage caused by BTC is large. It research calls the digital currency ‘digital oil’ instead of the commonly used description ‘digital gold’.
Bitcoin must get rid of proof-of-work
The study seeks to estimate the climate damage caused by Bitcoin mining. The researchers also try to make a comparison with other industries. The research claims that between 2016 and 2021, on average, every $1 of BTC in market value was responsible for $0.35 in global climate damage. According to the researchers, this is comparable to the production of beef and crude oil.
The researchers say it is unlikely that the Bitcoin network will become sustainable if it does not switch to a more energy-efficient consensus such as proof-of-stake. They say it must be regulated as soon as possible and if this is not done it will lead to increasing global climate damage.
“If Bitcoin does not shift from proof-of-work, this class of digitally scarce commodity may need to be regulated, and slowing down is likely to lead to increasing global climate damage.”
More and more people agree with the researchers. Bitcoin needs to get rid of the energy-guzzling proof-of-work. This sentiment is only increasing now that Ethereum has successfully pushed the Merge to proof-of-stake.
University of Cambridge paints more positive picture for Bitcoin
However, not all researchers agree on how big the climate impact of Bitcoin is. The University of Cambridge currently reports that the Bitcoin network currently consumes 94 terawatt hours (TWh) per year. To put this into context, the refrigerators in the United States alone consume more than the entire BTC network at 104 TWh per year.
Cambridge also reports that demand for power from the Bitcoin network has declined by 28% since mid-June. This is likely due to miner capitulations during the bear market and the use of more efficient mining hardware.
In addition, Bitcoin proponents point out that a very large part of BTC mining is done with renewable energy, especially that in the United States. According to them, Bitcoin is a lot less polluting than many people think.