Mining coal to burn at power plants has long been one of the most prominent pollutive sectors, but it turns out that mining in the digital world is proving to be another threat to the health of our planet.
What's happening?
After developing a formula to determine the electricity required to power every Bitcoin transaction, a team from financial market analyst BestBrokers found that global Bitcoin mining operations use 140.38 terawatt hours of electricity annually, per Greentech Lead.
Depending on the power source, that electricity consumption could emit as much as 115 million metric tons of carbon dioxide — a fraction of the total planet-warming gases cryptocurrency generates.
BestBrokers also used CoinGecko to find the cryptocurrency exchanges with the largest daily trading volumes and plugged that information into the Website Carbon Calculator to see which of those platforms have the highest carbon emissions per webpage visit. The analysts then multiplied those figures by a site's monthly visits to calculate its annual CO2 pollution.
Of the 10 centralized cryptocurrency exchanges BestBrokers listed, all produced at least 230 metric tons of carbon dioxide annually. P2B — which handles $1.5 billion in daily trading volume — was the worst offender, generating 736.3 metric tons of CO2.
The research team also examined the carbon footprint of NFT marketplaces using a similar method, discovering that the top 10 most carbon-intensive websites ranged between 0.99 metric tons and 122.13 metric tons of CO2.
Why is the amount of energy cryptocurrency mining uses concerning?
BestBrokers contextualized just how exhaustive and damaging this industry is to Earth, including the number of trees needed to absorb the CO2 each cryptocurrency exchange produces.
For example, around 33,441 trees would be needed to offset P2B's 736.3 metric tons of CO2 — an emission level equivalent to what 1,920 MWh of electricity would generate if it were exclusively powered by coal.
That electric output is enough to charge 438,322 smartphones every day for a year or fully charge 33,447 Tesla Model Y cars.
The issue created by crypto mines has taken a toll in Texas, as it has threatened to crash power grids across the state. One community in Texas has even filed a lawsuit against a local mining facility for negatively affecting residents' quality of life.
What's being done about the energy cryptocurrency mining uses?
BestBrokers noted that cryptocurrency network Ethereum has helped reduce the energy consumption of its transactions by 99.95% after switching from a proof-of-work mechanism to a proof-of-stake system.
Meanwhile, the Energy Information Administration is looking to hold the industry accountable by having cryptominers report their energy use data.
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