Bitcoin carbon emissions
Concerns about Bitcoin's environmental effects relate the network's energy consumption to carbon emissions.[41][42] The difficulty of translating energy consumption into carbon emissions is due to the way bitcoin mining is distributed, making it difficult for researchers to identify miner's location and electricity use. The results of studies into Bitcoin's carbon footprint vary.[10][11][13] Per a study published in Finance Research Letters in 2021, the differences in underlying assumptions and variation in the coverage of time periods and forecast horizons have led to Bitcoin carbon footprint estimates spanning from 1.2–5.2 Mt CO2 to 130.50 Mt CO2 per year.[43] According to studies published in Joule and American Chemical Society in 2019, Bitcoin's annual energy consumption results in annual carbon emission ranging from 17[44] to 22.9 MtCO2 which is comparable to the level of emissions of countries as Jordan and Sri Lanka.[13]
In September 2022, a report in the journal Scientific Reports found that from 2016 to 2021, each US dollar worth of mined bitcoin market value also caused 35 cents worth of climate damage. This is comparable to the beef industry which causes 33 cents per dollar, and the gasoline industry which causes 41 cents per dollar. Compared to gold mining, "Bitcoin's climate damage share is nearly an order of magnitude higher" according to study co-author economist Andrew Goodkind.[14][15][16]
Electronic waste
See also: Electronic waste § Cryptocurrency e-waste, and Electronic waste in the United States
The total active mining equipment in the Bitcoin network and the related electronic waste generation, from July 2014 to July 2021.[45]
Bitcoins annual e-waste is estimated to be over 30,000 tonnes as of May 2021, which is comparable to the small IT equipment waste produced by the Netherlands. One bitcoin generates 272 g (9.6 oz) of e-waste per transaction. Due to the consistent increase of the Bitcoin network's hashrate, mining devices are estimated to have an average lifespan of 1.29 years until they become unprofitable and need to be replaced.[17][18] Other estimates assume that a Bitcoin transaction generates about 380 g (13 oz) of e-waste, equivalent of 2.35 iPhones.[19] Unlike most computing hardware the used application-specific integrated circuits have no alternative use beyond bitcoin mining.
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Alternative energy usage
The development of intermittent renewable energy sources, such as wind power and solar power, is challenging because they cause instability in the electrical grid. Several papers concluded that these renewable power stations could use the surplus energy to mine Bitcoin and thereby reduce curtailment, hedge electricity price risk, stabilize the grid, increase the profitability of renewable energy infrastructure, and therefore accelerate transition to sustainable energy and decrease Bitcoin's carbon footprint.[47][48][49][50][51]
The Mechanicville Hydroelectric Plant in New York State and three hydroelectric power plants in San Pedro de Poás, Costa Rica[53] have reactivated to mine cryptocurrency. According to the owners of the Mechanicville plant, the mining prevented the plant from being dismantled.
Responses
A survey[54] on technologies approached cryptocurrencies' technological and environmental issues from many perspectives and noted the plans of using the methods of unconventional computing and grid computing to make Bitcoin both greener and more justified.
Per a 2021 study in Finance Research Letters, "climate-related criticism of Bitcoin is primarily based on the network's absolute carbon emissions, without considering its market value." It argues that the inclusion of Bitcoin in an equity portfolio reduces that portfolio's "aggregate carbon emissions".
Policy to move from proof of work to proof of stake has been compared to policy to move from fossil-fueled to electric cars, with some calling for a ban on PoW.
Bitcoin developers are working on the Lightning Network. The aim is to reduce the energy demand of the network by moving most transactions off the blockchain.