How to reduce the environmental damage of cryptocurrencies

The mining industry is growing. At the same time, environmentalists became more active and spoke out about the detrimental effect of crypt mining on nature. He even talked about it Elon Musk refused to accept bitcoins as payment for electric cars. Is this process really that dangerous? Are there ways to reduce the damage?

Protect Environmental damage of cryptocurrencies

It would seem that it is not easy to link electronic money and environmental pollution. After all, a digital currency is intangible: it’s just a set of ones and zeros within a virtual network. In fact, in itself, it does not harm the environment. However, the same cannot be said of its production.

As you know, the issuance of some cryptocurrencies is based on PoW mining. This method uses the computing power of the computer’s hardware. While they were little, no one thought about energy consumption. The situation changed in 2017 during the cryptocurrency boom. Bitcoin has become so popular that even remote villages talk about it. In the same period, for the first time, they tried to assess the indirect impact of mining on the environment.

Emissions from electricity production

According to Digiconomist, in 2017, cryptocurrency mining devices combined consumed more than 30 TWh (30 billion kWh) of electricity per year. That’s more than all of Ireland spends. In 2021, according to various estimates, more than 95 TWh were spent on mining needs. Environmentalists point out that only the generation of current for the extraction of bitcoin leads to the emission of 45 tons of carbon dioxide into the atmosphere per year. This is comparable to the annual CO₂ emission in a metropolis like Hong Kong.

Recent research paints an even more dismal picture. They point out the underestimation and inaccuracy of the estimates made earlier. According to the analysis, mining consumes half the electricity of all existing data centers in the world:

  • Mining centers;
  • Supercomputers;
  • Cloud services;
  • Server clusters.

Chinese scientists argue that cryptocurrency mining may threaten the implementation of international programs to reduce harmful emissions into the atmosphere.

Electronic contamination

In addition to damage from electricity generation, mining generates an increase in the amount of household waste. Includes equipment that has failed or has become inefficient.

In the early stages of crypto mining, when there was enough CPU and GPU power to do so, the amount of such waste was small. After all, processors and video cards, even outdated ones, could be used for other tasks. The problem arose with the introduction of ASICs, special integrated circuits created exclusively for these purposes.

Asics are much more efficient at mining than CPUs and GPUs. Its use has led to a sharp increase in the complexity of calculations. To stay competitive, manufacturers are forced to constantly increase the power of integrated circuits.

This process seems endless. Almost every year new and more powerful devices are released. Past generations of asics at the same time become uncompetitive and unprofitable. For purposes other than mining, they cannot be used. Naturally, they are sent to scrap.

Is everything so bad?

There is no denying the fact that cryptocurrency mining consumes a huge amount of electricity. But not everything is made from fossil fuels, which pollute the air when burned in power plants.

According to a study conducted by CoinShares in 2019, 74% of bitcoin mining energy costs are covered by renewable energy sources. Take, for example, the well-known company BitRiver, which provides hotel mining and cloud mining services. His administration claims that it feeds mining farms entirely from environmentally friendly sources. In addition, there is an opportunity to resell obsolete equipment.

As you know, the cost of a kilowatt-hour is not the same in different parts of the world. There are miners who have access to free or very cheap electricity. They will also need outdated, but relatively effective ASICs.

Of course, all this does not completely solve the problem. The catastrophe is only delayed. Another way to offset the environmental impact of mining is to use the large amount of heat that is generated during the process. Special industrial cooling systems can direct you to space heating in the cold season.

Crusoe Energy Solutions has its own know-how. She signed an agreement with the Norwegian Equinor. Now mining is carried out with the electricity produced by burning associated natural gas. It is released during oil production and is generally not used rationally.

Some experts say that even a shift to renewable energy sources does not guarantee a reduction in the environmental danger of mining. For example, hydroelectric power opportunities are seasonal. During the year, the power generated by the hydroelectric plant can fluctuate by 30%. During periods of low production, miners will have to switch to electricity obtained from fossil fuels, causing damage to nature.

Is mining to blame for all the problems?

It is impossible to accurately calculate the damage that crypto mining causes to nature. However, the useful properties of digital currency cannot be ignored:

  • Financial independence of the state;
  • A means to save investments during periods of economic crisis;
  • Future money.

If you delve into the topic, you can find that it is not only mining that indirectly harms the environment. Jerry McGovern provides a good example in his book World Wide Waste. Regular spam emailing consumes a lot of electricity. Under the condition of their development, CHP plants would have to plant 1.6 billion trees to clean the air of fossil fuel combustion products. In turn, the pollution from the 1.9 billion queries Google users make in a year can offset 16 million trees.

Therefore, it cannot be argued that only crypt mining harms nature. It is more correct to talk about the general negative impact that modern technologies (and not only) have on the environment. This does not mean that it is necessary to let everything take its course. Humanity must seek alternative and non-aggressive energy sources. And also to use more energy efficient technologies and to restore the environment.