The Environmental Impact of Bitcoin Mining

As the world's most widely used cryptocurrency, Bitcoin has sparked intense debate about its environmental impact. With over 134 terawatt hours per year of electricity consumption, which is more than the entire country of Sweden or just under half of the United Kingdom, it's a significant concern for those looking to reduce carbon emissions. However, not all energy consumption by Bitcoin mining is created equal. It's estimated that 61 percent of Bitcoin's energy consumption comes from non-renewable sources, pumping tons of carbon into the atmosphere.

A significant proportion of Bitcoin mining is done in China, which remains heavily dependent on coal. In fact, a failure of one coal plant in China cut out the processing power of the entire Bitcoin network by over a third. This has led to concerns about the environmental impact of Bitcoin mining, with some researchers projecting that it could warm the planet by 2 degrees Celsius before the year 2050. While this sounds alarming, there are also arguments to be made that Bitcoin mining could accelerate the growth of the renewable energy sector.

Mining companies seek the cheapest forms of electricity available to maximize profits. In China, during the rainy months, mining activity spikes due to an abundance of cheap hydroelectric power. This has led to a notable exception, with 50 percent of world Bitcoin mining powered almost entirely by renewables. Large-scale mining operations often move to rural areas for the low energy costs, which makes this a way that Bitcoin could help accelerate the transition to cleaner energy.

The carbon footprint of traditional banking and financial sectors is also an environmental concern. The production of credit cards, payment processing, and printing paper money all have significant environmental impacts. Furthermore, having the US dollar as the world's reserve currency has an environmental cost. Oil prices are given in US dollars due to an agreement made with Saudi Arabia back in the 1970s, which led to many of the US dollars received by Saudi Arabia being reinvested in American companies that provide equipment for extracting oil.

Despite this, not all Bitcoin mining is created equal. While it's true that proof-of-work cryptocurrencies like Bitcoin and Ethereum 1.0 have significant environmental impacts, they aren't destroying the planet. However, the issues they pose are something we'll have to reckon with. One potential solution is using alternative energy sources, such as solar panels on graphics cards.

In conclusion, while Bitcoin mining has a significant environmental impact, it's not necessarily a reason to ban or limit its use entirely. Instead, we can consider ways to mitigate these impacts and potentially even accelerate the growth of renewable energy. By exploring new technologies and innovative solutions, we can find ways to reduce the carbon footprint of Bitcoin mining and create a more sustainable cryptocurrency.

For businesses looking to minimize their environmental impact, FreshBooks is an invoicing and accounting solution that's built for owners and their clients. Over 3000 business owners have rated FreshBooks an average of four out of five stars on GetApp because it's super easy to use and super easy to get up and running with award-winning support. With FreshBooks, you can save 46 hours a month, get paid 18 days faster, and increase your ROI by 11 times. Try FreshBooks free for 30 days no credit card required by going to Freshbooks.com/techwiki and entering "tech quickie" in the how did you hear about us section.

"WEBVTTKind: captionsLanguage: enso there's a lot that's been made about bitcoin's energy consumption which isn't surprising considering the general advice is for home miners to not even try to mine it as the energy cost needed to run gpus means you'd probably never even make a profit but nonetheless large-scale mining continues and bitcoin transactions are processed every day which sucks down a lot of power much of which is coming from polluting sources like coal plants so is bitcoin actually going to be some kind of monetary messiah or is it really just killing our planet at first glance the numbers are a little alarming if you just look at the energy consumption of the bitcoin network alone in late april 2021 it was around 134 terawatt hours per year that's more than the entire country of sweden or just under half of the united kingdom and consumption will probably keep rising this might not be that big of a deal if the energy were coming from clean sources but it's estimated that 61 percent of bitcoin's energy consumption is from non-renewable sources at this time which obviously pump lots of carbon into the atmosphere then you have the fact that a huge proportion of bitcoin mining is done in china which remains heavily dependent on coal earlier this year a failure of one coal plant in china cut out the processing power of the entire bitcoin network by over a third all this carbon had one group of researchers projecting that bitcoin alone could affect the atmosphere enough to warm the planet by 2 degrees celsius before the year 2050 a huge amount when talking about global climate so does that mean that we should be pumping the brakes on bitcoin mining well hold on a second the study we just mentioned had plenty of detractors who pointed out it made a ton of assumptions about the actual volume of mining that would take place over the next few decades and the assumptions about how that mining is done and the resources of it and everything that may have been wrong but outside of that there's also an argument to be made that bitcoin mining could actually accelerate the growth of the renewable energy sector the idea is that miners are seeking the cheapest forms of electricity available in order to maximize profits remember how we mentioned that most bitcoin mining utilizes non-renewables well there's actually a notable major exception during the rainy months in sichuan china mining activity spikes due to an abundance of cheap hydroelectric power growing to 50 percent of world bitcoin mining powered almost entirely by renewables in this vein energy companies might have an incentive to keep building out renewable infrastructure in rural areas where solar wind and hydropower are usually more abundant in response to demand from miners large-scale mining operations often move to rural areas for the low energy costs already making this one way that bitcoin could help accelerate the transition to cleaner energy and of course we should think about the carbon footprint of the traditional banking and financial sectors manufacturing plastic credit cards processing multiple step interactions printing paper money keeping the lights on in offices with all those employees how about the branches how about atms how about the carbon footprint of the the trucks the protected vehicles that move all have an environmental impact not just in terms of actual materials and energy used but also the fact that simply having the us dollar as the world's reserve currency has an environmental cost as part of the reason it has so much clout globally is that oil prices are given in u.s dollars thanks to an agreement made with saudi arabia back in the 1970s many of the u.s dollars saudi arabia received in exchange for oil were reinvested in american companies who provide equipment for extracting oil as well as stocks and other large american firms outside the oil industry and while today there are many other reasons the us dollar is the world's reserve currency oil did help propel it to that status we're not trying to either praise or condemn any nation's behavior the point is that the bones of the world economy are already heavily linked to fossil fuels even without crypto but this doesn't mean that we should just be ignoring the impact of energy-intensive mining it's still an issue serious enough that elon musk who is trying to convince the u.s environmental protection agency to let tesla sell renewable energy credits to polluting power companies decided that tesla would no longer accept payments in bitcoin as environmental regulators are currently frowning upon crypto so what's the answer to the question then well bitcoin and other proof-of-work cryptos like ethereum 1.0 probably aren't destroying the planet but the issues they currently pose are something we'll have to reckon with but until then maybe we should start putting those little calculator style solar panels on graphics cards i think we can make a dent thanks to freshbooks for sponsoring this video freshbooks is an invoicing and accounting solution that's built for owners and their clients they say the average user saves 46 hours a month and gets paid 18 days faster and increases their roi by 11 times these are huge for freelancers and small business owners who don't have time to waste on invoicing accounting and payment processing over 3000 business owners have rated freshbooks an average of four out of five stars on get app because it's super easy to use and super easy to get up and running with award-winning support so you're never alone try freshbooks free for 30 days no credit card required by going to freshbooks.com techwiki and entering tech quickie in the how did you hear about us section so thanks for watching guys if you like this video like subscribe and hit us up in the comments section with your suggestions for videos that we should cover in the futureso there's a lot that's been made about bitcoin's energy consumption which isn't surprising considering the general advice is for home miners to not even try to mine it as the energy cost needed to run gpus means you'd probably never even make a profit but nonetheless large-scale mining continues and bitcoin transactions are processed every day which sucks down a lot of power much of which is coming from polluting sources like coal plants so is bitcoin actually going to be some kind of monetary messiah or is it really just killing our planet at first glance the numbers are a little alarming if you just look at the energy consumption of the bitcoin network alone in late april 2021 it was around 134 terawatt hours per year that's more than the entire country of sweden or just under half of the united kingdom and consumption will probably keep rising this might not be that big of a deal if the energy were coming from clean sources but it's estimated that 61 percent of bitcoin's energy consumption is from non-renewable sources at this time which obviously pump lots of carbon into the atmosphere then you have the fact that a huge proportion of bitcoin mining is done in china which remains heavily dependent on coal earlier this year a failure of one coal plant in china cut out the processing power of the entire bitcoin network by over a third all this carbon had one group of researchers projecting that bitcoin alone could affect the atmosphere enough to warm the planet by 2 degrees celsius before the year 2050 a huge amount when talking about global climate so does that mean that we should be pumping the brakes on bitcoin mining well hold on a second the study we just mentioned had plenty of detractors who pointed out it made a ton of assumptions about the actual volume of mining that would take place over the next few decades and the assumptions about how that mining is done and the resources of it and everything that may have been wrong but outside of that there's also an argument to be made that bitcoin mining could actually accelerate the growth of the renewable energy sector the idea is that miners are seeking the cheapest forms of electricity available in order to maximize profits remember how we mentioned that most bitcoin mining utilizes non-renewables well there's actually a notable major exception during the rainy months in sichuan china mining activity spikes due to an abundance of cheap hydroelectric power growing to 50 percent of world bitcoin mining powered almost entirely by renewables in this vein energy companies might have an incentive to keep building out renewable infrastructure in rural areas where solar wind and hydropower are usually more abundant in response to demand from miners large-scale mining operations often move to rural areas for the low energy costs already making this one way that bitcoin could help accelerate the transition to cleaner energy and of course we should think about the carbon footprint of the traditional banking and financial sectors manufacturing plastic credit cards processing multiple step interactions printing paper money keeping the lights on in offices with all those employees how about the branches how about atms how about the carbon footprint of the the trucks the protected vehicles that move all have an environmental impact not just in terms of actual materials and energy used but also the fact that simply having the us dollar as the world's reserve currency has an environmental cost as part of the reason it has so much clout globally is that oil prices are given in u.s dollars thanks to an agreement made with saudi arabia back in the 1970s many of the u.s dollars saudi arabia received in exchange for oil were reinvested in american companies who provide equipment for extracting oil as well as stocks and other large american firms outside the oil industry and while today there are many other reasons the us dollar is the world's reserve currency oil did help propel it to that status we're not trying to either praise or condemn any nation's behavior the point is that the bones of the world economy are already heavily linked to fossil fuels even without crypto but this doesn't mean that we should just be ignoring the impact of energy-intensive mining it's still an issue serious enough that elon musk who is trying to convince the u.s environmental protection agency to let tesla sell renewable energy credits to polluting power companies decided that tesla would no longer accept payments in bitcoin as environmental regulators are currently frowning upon crypto so what's the answer to the question then well bitcoin and other proof-of-work cryptos like ethereum 1.0 probably aren't destroying the planet but the issues they currently pose are something we'll have to reckon with but until then maybe we should start putting those little calculator style solar panels on graphics cards i think we can make a dent thanks to freshbooks for sponsoring this video freshbooks is an invoicing and accounting solution that's built for owners and their clients they say the average user saves 46 hours a month and gets paid 18 days faster and increases their roi by 11 times these are huge for freelancers and small business owners who don't have time to waste on invoicing accounting and payment processing over 3000 business owners have rated freshbooks an average of four out of five stars on get app because it's super easy to use and super easy to get up and running with award-winning support so you're never alone try freshbooks free for 30 days no credit card required by going to freshbooks.com techwiki and entering tech quickie in the how did you hear about us section so thanks for watching guys if you like this video like subscribe and hit us up in the comments section with your suggestions for videos that we should cover in the future\n"