In an ironic twist, countries looking to ban Bitcoin mining for environmental reasons may actually do more harm than good, a new study found.
What's happening?
The research, conducted by the nonprofit Exponential Science and the University College London, looked at the comparative energy and pollution costs of Bitcoin mining across different countries. Mining is highly energy-intensive, as it necessitates the constant use of entire warehouses of computers all running at once.
Unfortunately, many of the places looking to ban mining are the ones already using more sustainable energy sources to power it. This means that, if mining were to move to states and countries with higher carbon intensities — aka more dirty energy sources — they could do even more harm by running on fossil fuels in these new locations.
Canada is the perfect example of this conundrum, as Cointelegraph reported. As a country whose energy comes mostly from nuclear and hydroelectric sources, it tops the list as the place where a ban would trigger the largest increase in pollution — going up by over 2.75 million tons per year.
Why is this important?
Cryptocurrency mining has long been a concern for environmental advocates. Not only does the mining generate high energy and pollution costs, but the physical noise and vibration from the mining centers have been so damaging to nearby residents that many have sued.
However, studies like this are critical for assessing the unintended consequences of even the most well-intended policies, keeping governments from accidentally doing more harm than good.
While the research was discouraging for countries with renewable energy looking to further diminish their footprint, nations that rely more heavily on dirty fossil fuels could benefit greatly from the findings. For example, Kazakhstan could cut its pollution by up to 3.75 million tons per year if it bans Bitcoin mining activity, CryptoSlate reported.
What's being done about cryptocurrency mining?
Given these findings, researchers pushed for nuance when it comes to regulating Bitcoin mining, rather than enacting hasty bans. Additionally, they encouraged governments to continue incentivizing clean energy sources for all mining activities of what's been considered the "biggest financial innovation."
The onus of sustainable cryptocurrency mining falls on governments and companies, but the individual investor can continue voting with their dollars by doing research and investing in cryptocurrencies that are more transparent with their environmental policies and impact.
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