Bitcoin Mining and Climate Change

The Argument

Bitcoin mining uses too much electricity. Bitcoin mining is producing too much heat that’s causing climate change. Bitcoin mining activities are mostly centered in China which burns coal for electricity. Blah blah blah…

Such was the usual rhetoric that would often come out of every Bitcoin critics and environmentalist. It was also one of their most used points of argument. I’m not saying that there’s no truth to their argument. Actually there argument made sense and is based on facts.

Bitcoin mining DO uses too much electricity. According to some studies, Bitcoin mining uses more electricity than the country of Argentina. For a mining operation to use more electricity than a country might indeed be a little too much.

Bitcoin mining is indeed producing too much heat. Crunching the blocks used in Bitcoin transactions forces mining rigs to consume a large amount of electricity that forces the rig to work really hard during the mining process resulting in a lot of heat which would then be release in the environment. But as for whether the heat that was a result of Bitcoin mining worsen or even contributes to climate change is yet to be proven.

Currently, a large number of Bitcoin miners are in China. And as mentioned, China produces a large percentage of it electricity through burning coal which produces a large amount of carbon emission, the number cause of climate change. The fact that most major Bitcoin mining operation was located in China is indeed a cause for concern but not because it’s a cause of climate change but mainly due to the policy of the country’s government (which I won’t be discussing in this article.)

The Counter-Argument

The argument of some Bitcoin critics and environmentalist is indeed valid. The problem with that though were not the issues itself but how these critics uses said issue to attack Bitcoin and cryptocurrency in general.

Certainly, Bitcoin mining uses tons of electricity but so does factories around the world. Both machineries and mining rigs require a lot of electricity in order to function. If they want to argue that cryptocurrency is not as useful as these factories then I would have to disagree with them. The blockchain technology, the technology behind all cryptocurrencies is far from useless.

The blockchain technology had seen many real-life applications throughout the years. From digital currency used to pay for online services, to applications that were used by industries such as aviation, to humanitarian works like the $3 million volcano catastrophe bonds that was backed by the Danish Red Cross which would allow the Red Cross organization to quickly release funds during volcanic eruptions.

Admittedly, the blockcchain not yet as develop as any other technology but that’s only because the blockchain was a relatively young technology. Give it another decade or two and its true value would be unveiled. In other words the blockchain technology behind Bitcoin and other cryptocurrencies is by no way inferior to other technology.

Now as for the issue of electricity usage, I’m confident that that too would be addressed in the near future. In reality, Bitcoin and other cryptocurrencies is just a piece of software that could only function with the help of the computer hardware it uses. Meaning, to fix the problem, the hardware should be addressed before the software. This is because no matter how optimized the software was it won’t change the situation much if the hardware issue was not fixed. Thankfully, technology advances year after year so the electricity problem won’t be an issue forever.

Now that’s done let us tackle the “too much heat” issue.

Same as the first argument, the true problem here lies in the hardware aspect and not in software aspect were Bitcoin is categorized. The reason the mining rig produces too much heat was due to the fact that the graphic cards used to mine Bitcoin were graphic cards used for gaming tweaked to be useable for cryptocurrency mining.  In other words, the hardware used for mining was not specifically used for cryptocurrency mining purposes.

This phenomenon is very similar to how low-end graphic cards heats up quickly when used to run graphically demanding games. The reason for this was because the graphic card itself is not powerful enough and as such would over heat as the graphic card chugs in more juice (electricity) as it attempt to run said graphically intensive games. So in order to reduce the heating problem, hardware made specifically for cryptocurrency mining should be developed.

Aside from developing new hardware, there’s actually another way – to use the excess heat to help the environment.

How?

Use the excess heat produced by mining Bitcoin to heat up one’s home, or to make a mining-heated greenhouse. Not only is this method environment-friendly it’s economical too as people no longer need to pay for home or greenhouse heating during cold weathers. It was two birds with one stone!

The concept I mentioned is not just a concept, innovative people and companies actually made good use of it and produced products that do exactly that. For example, the company Wisemining invented a boiler, called Sato that could not only mine but heats up the users home as well. The boiler itself need a separate mining rig in order to work but once installed, miners no longer have to worry of the cold winter or the heating bill.

Genesis Mining, a Nordic mining company had proposed a project that would direct heat from their mining operation to greenhouses in the nation via ducts to grow fruits and vegetables. The company was actively trying to partner with local producers in order realized their vision of giving back to the community. Once successful, the excess heat from Bitcoin mining would help in the production of food in the country.

Now to the final issue: carbon emission and greenhouse gases.

This issue is both simple and complicated. Simple because addressing this issue is actually easy and it was to move out of China and go to other countries that doesn’t burn coal to power their cities. Complicated because the move would increase the cost of the mining operation, and is therefore would depend on the mining company.

The main reason why majority of miners was located in China was because of their cheap electricity. Their reasoning is actually the same as that of other companies like Apple, Nike and many more, and that was the low cost of operation. The lower the cost of operation the more profit they would gain. To convince these companies to move out of China would be difficult but not impossible.

In recent years, more and more mining companies moved out of China and moved to other countries like Norway because of the country’s relatively cheap and clean energy. If this trend continues then Bitcoin critics and environmentalist would no longer have anything to complain about as Bitcoin mining would become environmentally friendly.

Conclusion

The issues surrounding Bitcoin mining has always been an obstacle towards mass adoption. For the Bitcoin and other cryptocurrencies to become mainstream, this obstacle must be removed. That said, Bitcoin mining even in its current state is still more environmentally friendly compared to gold mining, which produces gold that most Bitcoin critics loves to tout. It’s ironic that they would use such an argument when the precious metal they loved so much was literally produced at the expense of the environment.

Anyway, this is just my opinion, and whether you agree to my opinion is all up to you guys. Thank you for reading, until next time.

Image Source:

https://pixabay.com/illustrations/white-males-gold-the-gold-standard-4950613/

https://pixabay.com/photos/mining-excavator-electric-1736289/