First and foremost, consider how bitcoin’s environmental impact is to know the severity of the ecological problems. Because protecting our planet’s health is the most pressing issue that requires the attention of everyone and every organization. Elon Musk opposed cryptocurrency mining, particularly bitcoin mining, and does not accept bitcoin in Tesla payments. In addition, China is another country that opposes bitcoin due to the environmental impact of its excessive use of energy. This country’s determination and intolerance have positively impacted the environment, but they have caused global economic and financial harm. That is still a contentious and unresolved issue. Follow Hanfincal to discover the details.
1. What is bitcoin (BTC)?
“It’s a marketplace and as long as people are willing to assign value to it, then that’s it,” said R.A. Farrokhnia, Columbia Business School professor and executive director of the Columbia Fintech Initiative. BTC is a new currency created on Halloween, 2009, by an unknown person who went by Satoshi Nakamoto’s alias. It is a digital currency released as open-source software. Without using a bank as an intermediary such as a bank, you can buy, sell, and exchange BTC directly.
BTC’s value has skyrocketed since its initial public offering in 2009. Although it once sold for less than $150 per coin, one BTC now sells for more than $61,000 as of October 29, 2021. Much of the hype of BTC value revolves around making money by trading it. Nakamoto – father of BTC – set a limit of 21 million bitcoins. However, as of September 2021, an estimated 18.8 million BTC were in circulation; all remaining BTC were released by 2140.
What’s Bitcoin?
2. How powerful is BTC?
BTC was the first and most widely used cryptocurrency in the world of e-commerce. People used to admit BTC as an international remittance at low costs. After that, many start-ups provide BTC remittance services that are well-known to many people. It was an excellent beginning. Furthermore, some businesses are currently analyzing and preferring to pay in BTC to reduce costs and save time for their operations.
Both Blockchain and BTC have convenient applications in current and future life. If we know how to take the advantages and avoid the disadvantages, it will undoubtedly produce unexpected results.
Some of the pros and cons of BTC:
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Pros:
- The Blockchain technology platform is at the heart of the current BTC’s success.
- All BTC transactions are not routed through an intermediary and are not governed by any organization.
- The supply of Bitcoins is automated and delivered to BTC mining computers using predefined algorithms.
- Simple accessibility and rapid liquidity: It only takes a few minutes to send bitcoins to another user.
- Transparency and user anonymity: BTC users are identified by numerical codes and can have multiple public keys. There is no public tracking available. Even though the transactions are permanently visible, which provides transparency, they are still protected from fraud thanks to blockchain technology.
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Cons:
- BTC is an anonymous coin that is not under the control of any central bank or regulatory agency. As a result, investing in it is unregulated. BTC transactions lack legal protection and are typically irreversible, making them vulnerable to fraud.
- Previously, BTC had a somewhat obscure past in which it was considered a means of money laundering for terrorist organizations.
- A minimum valuation is not guaranteed. So, if a large group of investors decides to stop using bitcoins and sell them, the value of bitcoins could plummet dramatically, affecting users who have a large amount of BTC.
- Although a growing number of big companies, including Tesla, Microsoft, and some Subway franchises, accept BTC, it is still not widely accepted. Unlike using a credit or debit card, this limits where you can spend your money.
- Due to many BTC miners, there is competition. If you invest time or equipment to mine BTC, you may not own it because there are many miners out there, and they are mining the same BTC with you at that time and become your strong competitors. That results in a BTC scramble; if you win, you own it; if you lose, it’s as if you wasted your time and effort.
3. How does BTC affect the environment?
Here is Tesla CEO Elon Musk’s statement regarding the abolition of BTC and other cryptocurrencies because they harm our environment and consume a lot of energy. What is bitcoin’s environmental impact? Now it’s time to go exploring.
Elon Musk’s Status
Energy consumption
BTC is estimated to consume 707 kWh per transaction. According to the BBC 2021, BTC mining will consume 121 Terawatt-hours of electricity per year. That is more than Argentina’s total consumption, or more than the combined consumption of Google, Apple, Facebook, and Microsoft.
BTC’s energy consumption was nearly 62-fold between 2015 and March 2021. According to Cambridge University, only 39% of this energy comes from renewable sources, negatively affecting ecosystems.
Greenidge Generation, a former coal-fired power plant in Dresden, New York, converted to natural gas and mining BTC. When it became one of the largest cryptocurrency miners in the United States, its greenhouse gas emissions nearly tenfold increased between 2019 and 2020. Greenidge intends to double its mining capacity by July 2022.
Earth Justice and the Sierra Club have warned that nearly 30 power plants in upstate New York could be converted to BTC mining operations, undermining New York State’s efforts to eliminate virtually all greenhouse gas emissions by 2050.
All proof above, BTC’s environmental impact is equivalent to Sweden’s annual electricity consumption of 131.80TWh. Or comparable to Ukraine’s (128.81TWh/year) or Argentina’s (125.03TWh/year) consumption.
Bitcoin Mining Energy Consumption
Greenhouse gas emissions
According to CNBC, BTC mining emits approximately 35.95 million tons of CO2 per year.
Globally, BTC’s power consumption has dire consequences for climate change because it translates into an estimated 22 to 22.9 million metric tons of CO2 emissions per year—equivalent to the CO2 emissions from the energy use of 2.6 to 2.7 billion homes in a year. Moreover, BTC could push global warming beyond 2°C in the next 30 years, and BTC mining in China alone could emit 130 million metric tons of CO2 by 2024.
Bitcoin Carbon Emissions
Water pollution and e-waste
Greenidge draws up to 139 million gallons of freshwater from Seneca Lake each day and discharges it at temperatures 30 to 50 degrees Fahrenheit higher than the lake’s average, endangering its wildlife. Its large intake pipes suck in and kill larvae, fish, and other wildlife as well. Every year, the BTC network is estimated to generate 11.5 kilotons of e-waste.
E-waste from Bitcoin Mining
Future for sustainable BTC
- Elon Musk, CEO of Tesla, met with the CEOs of the top North American crypto mining companies to discuss their energy usage. As a result, they found a new BTC Mining Council to promote energy transparency.
- The Crypto Climate Accord seeks to decarbonize blockchains by implementing more energy-efficient validation methods; Cryptocurrency Mining Headquarters are located in areas with excess renewable energy. The goal of this Accord is to run on 100 percent renewable energy by 2025 and for the cryptocurrency industry as a whole to achieve net-zero emissions by 2040.
- Ethereum (ETH), another cryptocurrency, also aims to reduce its energy consumption by 99.95% by 2022.
- Another brilliant idea is to locate BTC operations near oil fields, where they can tap waste methane gas or pipe it to generators and use the power for BTC mining.
- However, Farrokhnia believes that these measures are only feasible when the price of BTC is as high as it is now. If its price falls one day, the above measurements will fail because it will not secure the financial resources to operate. He also hopes for greener cryptocurrency lies in its evolution.
Frequently ask questions about BTC
Which crypto is most sustainable?
The most popular alternative is Cardano. It has a new blockchain that it claims is more sustainable and scalable than BTC and Ethereum (ETH) (the second-largest coin).
Is bitcoin a real coin?
Mining is a method of earning cryptocurrency without paying for it. It is a reward for completing “blocks” of verified transactions added to the blockchain. Using blockchain technology to create, trade, distribute, and store BTC, a decentralized ledger system.
Can I invest $100 in Bitcoin?
Yes, without a doubt. You can purchase BTC fractions up to $100, which means you don’t have to buy the entire coin, currently priced at $60,735.40. (October 29, 2021).
Everything has its benefits and drawbacks, no matter how good it is. You need to carefully consider and learn about these two aspects so that you can contribute to promoting its benefits and minimizing its drawbacks. Everyone recognizes BTC’s convenience, but its adverse bitcoin’s environmental impact is unavoidable. However, the Chairmans of many organizations are also finding and gradually improving to make the solutions more environmentally friendly. Hanfincal will update you with the newest information about financial assistance. Subscribe to receive it now.
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