Last summer, 42 percent came from renewable sources like hydropower.
This number dropped to 25% in the fall.
What has changed? What changed? StudyPublished today in the journal JouleThe shift was unintended and a result of China’s August 2021 decision to ban Bitcoin mining.
Data scientist says that there was optimism that China’s ban on Bitcoin mining would make mining more sustainable. Alex de VriesCo-author of this paper:
“[T]It was already a dirty industry, and it only got worse.” He says.
China was a cryptocurrency powerhouse prior to the ban on Bitcoin mining
China was home of the largest contingent of Bitcoin miners in the crucial period when cryptocurrency was evolving from a digital curiosity to a financial behemoth.
In September 2019,Computers in China used three quarters of all electricity used to mine bitcoins. These computers were powered by energy and used it to solve complex mathematical problems that control the growth in the total Bitcoin supply. The incentive for Bitcoin miners is huge: the 19,000,000 Bitcoins already on the platform are worth approximately three trillion dollars.
It was more profitable to mine Bitcoin in certain parts of the country because of the combination of cheap hydroelectric energy during the wet months and cheap coal-powered power the rest of year. The country was responsible for 65% of global mining activity, at its peak in 2020.
Last year’s ban sent miners out of the country — and away from renewable energy
China’s government has always been suspicious about Bitcoin. The country was able to acquire Bitcoin in 2009 Prohibited virtual currencies to pay for physical goods and services. Its central bank was established a few years later. Restriction severeConvert Bitcoin to yen The country also banned cryptocurrency trading and mining in September 2017.
Many of those miners — or their equipment — ended up across the border in Kazakhstan or across the world in the United States. Coal became an all-year energy source for those who remained in Asia. It’s more common for such systems in the United States to use energy from natural gas.
De Vries says that miners are more likely to set up shop in states with less renewable energy than the average. Popular destinations include Texas, Kentucky, Georgia, and the District of Columbia. Kentucky offers tax incentives to attract miners, and supports its coal companies.
Experts believe that Bitcoin miners are jointly responsible for releasing an extra amount of Bitcoin. 65 megatonsannual production of carbon dioxide. Only one-quarter the world’s 200 countries produce more carbon dioxide per year.
De Vries says the study is a story about unintended consequences and shows that international cooperation is crucial if governments want to limit the environmental impact of Bitcoin.
However, it doesn’t seem possible.
According to the study, the authors state that there is no quick solution to Bitcoin’s carbon footprint.
