- One Bitcoin transaction is equivalent to burning 75 gallons of gasoline.
- China accounts for more than 75% of the BTC network's hashing power.
- Research published in Nature Communications says crypto mining activities will gradually grow and peak at 296.59 Terawatt-hours of energy (TWh) per year.
The energy consumption related to cryptocurrency mining is a topic of debate among critics and advocates of these digital assets. Minting one Bitcoin requires a lot of electricity, which is at odds with the global movement to reduce carbon emissions.
Bitcoin energy consumption might be a problem
A study conducted by Cambridge University indicates that Bitcoin mining accounts for approximately 130 Terawatt-hours of energy (TWh), equivalent to 0.6% of the world's electricity consumption.
In simpler words, Bitcoin uses more electricity per year than Argentina.
Brad Garlinghouse, Ripple’s CEO, maintains that "one Bitcoin transaction is equivalent to 75 gallons of gasoline being burned."
One Bitcoin transaction equals 75 gallons of gasoline being burned, says Ripple CEO Brad Garlinghouse to @emilychangtv about the impact of Bitcoin mining on the environment https://t.co/LCQb0v0AyY pic.twitter.com/ibYj0ClW2Q— Bloomberg TV (@BloombergTV) April 3, 2021
Meanwhile, Janet Yellen, U.S. Treasury Secretary said that Bitcoin represents an "extremely inefficient way of conducting transactions, and the amount of energy that's consumed in processing those transactions is staggering."
Crypto mining affects China’s carbon emissions reduction targets
A study by Chinese academics published in Nature Communications states that increased energy consumption by Bitcoin mining activity in China could counteract the country's efforts to reduce carbon emissions.
The researchers performed a data simulation and estimated that Bitcoin mining activity in China will gradually grow and peak at 296.59 TWh in 2024, generating roughly 130.50 million metric tons of carbon dioxide.
Chinese President Xi Jinping’s commitment to tackle climate change could result in a crackdown of the crypto mining industry in the nation. Since China accounts for more than 75% of the Bitcoin network's hashing power, the plans to cut down carbon dioxide emissions by over 65% by 2030 may be undermined.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.