Even in the depths of a bear market, there has been no letup in the criticism of Bitcoin (BTC), with new studies raising concerns about its energy usage and environmental impact.
According to the most recent study by economists at the University of New Mexico, which was released on September 29, Bitcoin functions more like “digital crude” than “digital gold” in terms of climate impact.
The study makes comparisons with other industries in an effort to determine the energy-related climate harm that proof-of-work Bitcoin mining causes. According to the claim, $0.35 in “climate damages” were caused globally for every $1 in BTC market value gained between 2016 and 2021. It further stated,
“Which as a share of market value is in the range between beef production and crude oil burned as gasoline, and an order-of-magnitude higher than wind and solar power.”
It is highly improbable that the Bitcoin network would become sustainable by moving to proof-of-stake, the researchers note in their conclusion, adding that the findings constitute “a series of red lights for any consideration as a sustainable industry.”
The paper added,
“If the industry doesn’t shift its production path away from POW, or move towards POS, then this class of digitally scarce goods may need to be regulated, and delay will likely lead to increasing global climate damages.”
After the Merge, Labrys’ founder and CEO, Lachlan Feeney, told Cointelegraph that Bitcoin is under pressure to explain the PoW algorithm in the long run. Labrys is an Australian blockchain development company.
However, there are always contrasting examples and arguments. According to the University of Cambridge, the Bitcoin network presently uses 94 terawatt hours (TWh) annually. To put this into perspective, the BTC network uses 104 TWh annually, which is greater than all the refrigerators combined in the US.
Additionally, the United States alone experiences 206 TWh in transmission and distribution electrical losses annually, which is enough energy to run the Bitcoin network 2.2 times. Cambridge also notes a 28% drop in the power consumption of the Bitcoin network since mid-June. This is probably because more effective mining hardware was deployed and miners capitulated during the bad market.
MicroStrategy’s Ex-CEO backs Bitcoin’s efficient energy usage
Michael Saylor, the former CEO of MicroStrategy, criticised “misinformation and propaganda” earlier this month over the energy consumption of the Bitcoin network. He cited statistics showing that over 60% of the energy used for Bitcoin mining came from environmentally friendly sources, and that year over year, energy efficiency increased by 46%.
Texas, which has recently been a mining mecca, is one example where renewables rule; it is the country’s top producer of wind energy. Additionally, a number of mining activities have been set up to utilize surplus or other wasteful energy, including gas flaring.