Cryptocurrencies are gaining more and more traction in the world, but not everyone is happy with this development. Environmentalists have long complained about the large carbon footprint of Bitcoin and other blockchain-based virtual currencies.
Bitcoin’s carbon footprint alone equals that of New Zealand with its nearly 37 megatonnes of CO2 per year, analysts say.
Other experts estimated a year ago that the Bitcoin network used just over 121 terawatt hours of energy, more than entire nations like Argentina, the Netherlands or the United Arab Emirates. And since then, the energy dependency of the cryptocurrency has increased further to over 130 terawatt hours.
To raise awareness of the giant and growing environmental impact of virtual currency, leading environmental groups such as Greenpeace and the Environmental Working Group will run advertisements in major US media outlets. The focus will be on finding ways to mitigate the effects of bitcoin on the climate.
“The goal is to persuade the bitcoin community of investors and backers to change the network code, removing the ‘proof of work’ mechanism that requires bitcoin ‘miners’ to spend a certain amount of energy when processing transactions to earn rewards in newly minted bitcoin,” writes the wall street journal .
“Bitcoin’s power consumption is a defense mechanism designed to protect the network. As it is an open-source project, anyone can run the software. But the network forces miners to spend large amounts of computing power so that it would be prohibitively expensive for someone to take over the network, which could allow them to create counterfeit bitcoins or erase transactions.
Bitcoin’s design is the problem
However, changing the code of the cryptocurrency, which is not owned by a single entity, would require broad consensus among everyone involved in its maintenance.
“It’s really by design that Bitcoin consumes so much electricity,” says Michel Rauchs, a researcher at the Center for Alternative Finance in Cambridge. “It’s not something that will change in the future unless the price of cryptocurrency drops significantly.”
A workable model for reducing Bitcoin’s energy consumption would be the switch that Ethereum, another popular virtual currency, is making from the proof-of-work model to one known as proof-of-stake.
“This change, the implementation of which has been repeatedly delayed for technical reasons, is expected to reduce Ethereum’s electricity consumption by 99%. The campaign hopes to make a similar change for bitcoin,” he says. the wall street journal .
By Daniel T. Cross. Articles in English