The Environmental Impact Of Cryptocurrency Mining

A few months ago, the cryptocurrency market saw a peak in its stock prices due to the announcement made by Elon Musk. Elon Musk’s tweet raised the cryptocurrency stock prices as investors could purchase cars from Tesla. Later Elon Musk announced that Tesla would no longer accept Bitcoin. The Bitcoin price dropped by 12%, as Elon Musk decided, due to the consequences of mining on the environment. The price dropped and incremental due to Elon Musk’s tweet, and people are reacting based on the stock value. However, many fail to realize that it is not a ploy by Elon Musk but a warning for our environment’s future.

Understanding The Concept Of Computation And Energy

Mining cryptocurrency requires a computer with high computational capabilities. Computers that handle complex computational problems are subject to use a higher amount of energy. For instance, you must have noticed that while playing games with good graphics on your mobile phone, you will notice that it heats up quickly. This is the electrical energy consumer into heat energy which is a law of thermodynamics. Thus, this simple example allows us to understand that there is an environmental risk in the problem.

Way before Elon Musk’s tweet regarding environmental impact on cryptocurrency, scientists had already discovered the problem. Computers with high computational capacity crave high energy produced using fossil fuels, coal, nuclear plants, and others, directly impacting the environment. Why should something that is not an essential thing affect the environment? Hence, one should take measures to solve the problem.

Power Consumed By Cryptocurrency Mining

To put this into perspective, it is important to understand the energy consumed while mining cryptocurrency. The specialized computers designed to solve high computation problems to mine cryptocurrency are called Application Specific Integrated Circuit. Data compilation on Bitcoin indicates that, on average, Bitcoin mining consumes energy comparable to the energy consumed by a whole country like Argentina. Moreover, the mining computations increase as competition demands it.

Hence, the consumption rate will go high in the future in the never-ending greed created by man. Furthermore, Bitcoin mining leaves a carbon footprint of 36.9 megatons, equating to carbon footprints left by countries like New Zealand. When you put these numbers into perspective, it tells you how much impact crypto mining will leave on the environment and generations to come.