Bitcoin brings big power bill
New research shows the use of Bitcoin causes around 22 megatons in CO2 emissions annually.
Bitcoin-related emissions are now equal to the output of a major city like Las Vegas.
Although Bitcoin is a virtual currency, the energy consumption associated with its use is very real.
For a Bitcoin transfer to be executed and validated, a mathematical puzzle must be solved by a computer in the global Bitcoin network.
The network, which anyone can join, rewards the puzzle solvers in Bitcoin. The computing capacity used in this process - known as Bitcoin mining - has increased rapidly in recent years. Statistics show that it quadrupled in 2018 alone.
Consequently, the Bitcoin boom raises the question of whether the cryptocurrency is imposing an additional burden on the climate.
Several studies have attempted to quantify the CO2 emissions caused by Bitcoin mining, but “these studies are based on a number of approximations,” says Christian Stoll, who conducts research at the Technical University of Munich (TUM).
For a more accurate result, the researchers used IPO filings of the companies that make Bitcoin-mining computer to calculate the market shares of the companies' respective products, and measured the efficiency of their devices.
They calculated the power consumption of the network, as of November 2018, to be about 46 TWh.
The team then used IP information to discover that 68 per cent of the Bitcoin network computing power is in Asian countries, 17 per cent in European countries, and 15 per cent in North America.
They combined their results with statistics on the carbon intensity of power generation in the various countries.
The conclusion of the study: The Bitcoin system has a carbon footprint of between 22 and 22.9 megatons per year. That is comparable to the footprint of such cities as Hamburg, Vienna or Las Vegas.
“Naturally there are bigger factors contributing to climate change. However, the carbon footprint is big enough to make it worth discussing the possibility of regulating cryptocurrency mining in regions where power generation is especially carbon-intensive,” says Prof Stoll.
“To improve the ecological balance, one possibility might be to link more mining farms to additional renewable generating capacity.”