By Kaden Pradhan
London, United Kingdom
Bitcoin has become the world leader in cryptocurrency. Since its launch in 2009, Bitcoin has seen its share of peaks and troughs and is a favorite of amateur investors looking for something with a little excitement to put their spare money into. What was worth around $12,000 sterling one year ago is now roughly $48,500—an immense gain over that time period, especially when compared to regular savings accounts and stock exchanges.
However, if you are thinking of investing in Bitcoin, it is worth considering the astonishing negative impact that it has on the environment. New evidence suggests that the mining and maintenance of Bitcoin consumes up to 1% of the entire world’s energy usage. This is roughly equivalent to the amount of electricity that the Netherlands uses per year, which is ranked thirty-first in the world for energy consumption. Individual transactions with Bitcoin also take up an extraordinary amount of electricity, a value more or less equivalent to the amount of power an average household in the U.S. would consume in a month. Payments made with Visa, by contrast, use roughly a million times less energy.
This extremely harmful effect is not forecast to decrease or even plateau any time soon: as the net worth of Bitcoin continues to rise, more people are incentivized to mine it, so more energy is consumed. Factor in the increased number of transactions, and this growth is projected to be exponential.
Supporters of Bitcoin have remained adamant that most of the mining servers are located in an area of the Sichuan province of China where most of the energy supplied is hydroelectric, a green and renewable source of energy. However, data collected recently suggests that over 60% of the electricity used by Bitcoin mining systems comes directly from fossil fuels, which means that the impact Bitcoin has on our climate is immense.
All this comes at a time when the environment remains in a state of crisis. Scientists have confirmed that we are reaching a climatic tipping point, and the general consensus is that our actions over the next handful of years will decide the fate of our planet for eons to come. I believe, as do many others, that it is now imperative to identify the sources of the gases which warm our world and halt them as best as we can. For many, however, the environmental impact of Bitcoin is not even on their radars. This is partly due to effective marketing and partly because it is a grossly underreported subject. Those who maintain and mine Bitcoin need to seriously consider ways to decrease their energy input and carbon output, and those who use Bitcoin need to decide whether it’s worth the detrimental effect that this currency has on the world we share and cherish before it is too late to make a different choice.