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December 5, 2022
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Understand why Bitcoin’s energy isn’t bad

Elon Musk’s claims that Tesla will no longer accept bitcoin as a means of payment once again put the spotlight on the issue of Bitcoin’s impact on the environment, but understand why Bitcoin’s energy is not bad.

The words of the Tesla CEO referred specifically to the consumption of polluting energy, in particular coal.

Bitcoin’s impact on the environment

The Bitcoin mining process has a high impact on the environment and requires a lot of energy. In fact, bitcoin mining is not at all convenient for ordinary people. The costs of solving the complex algorithms behind the blockchain consensus engine require mining farms, rooms with high-performance computer processors that consume electricity, both to mine and to validate transactions and, finally, to cool the machines.

But how much does Bitcoin mining consume?

According to a recent survey by the University of Cambridge, which compiled a special index called Cambridge Bitcoin Electricity Consumption Index , Bitcoin mining requires more energy than entire countries use. And against that, a crusade has started.

In the New York Times, Bill Gates stated:

“Bitcoin uses more electricity per transaction than any other method known to mankind and is therefore not a major climate problem.”

And while it is true that a Bitcoin transaction consumes up to 735 Visa transactions or 55,280 hours of YouTube videos, it is also true that, on average, a Bitcoin transaction is worth $ 16,000, while a Visa transaction is worth $ 46.

But it is precisely these figures who must have embarrassed Tesla. After all, what sense does it make for a company that produces electric cars, considered one of the solutions to pollution, to accept a currency that pollutes? This was one of the theses of HBO presenter and comedian Bill Maher. In reality, there are other aspects of the issue.

Bitcoin and energy consumption, the solutions

Does bitcoin consume energy? Yes. But Bitcoin supporters are not necessarily unscrupulous polluters. Bitcoin’s energy consumption is changing and evolving in favor of renewable resources.

Anthony Pompliano explained in recent days how progress is being made in this regard. For example, in China, Mongolia has banned mining, precisely because of its high consumption of coal. Another region of China, Xinjiang, known for its high consumption of coal, now consumes 40-50% of renewable energy. In Sichuan and Yunnan, Bitcoin mining farms run on hydropower.

In addition, China is gradually losing its dominance in Bitcoin mining. Canada and the United States are also entering this sector on a large scale, with much of the energy used coming from renewable sources.

In addition, there are projects carried out by major players, such as Jack Dorsey’s Square and Cathie Wood’s Ark Investment, that support the production of Bitcoin with renewable energy as a means of ecological transition.

In short, the “interested parts”From Bitcoin are well aware of the environmental problem and are also actively seeking a solution.

In any case, Ark Invest’s research in 2018 dismantled the myth that Bitcoin is the killer of the global environmental system due to its excessive energy consumption. This is because gold mining consumes more than Bitcoin. The most surprising thing is that the consumption of the traditional banking system is much higher than that of BTC. But nobody seems to be shocked by this.

Source: Cryptonomist

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