A recent study onenvironmental impact of Bitcoin shows that, as a percentage of the value in the market, mining cryptocurrency does more damage than raising cattle for meat. The researchers’ comparison is sobering: the only activities that are more dangerous for the environment are the distribution of gasoline and gas-fired power plants.
Bitcoin, the environmental impact is comparable to meat production
The study published on behalf Benjamin A. Jones, Andrew L. Goodkinf e Robert P. Berrens dell‘University of New Mexico on Scientific Report, analyzes the climate impact of Bitcoin dal 2016 al 2021. And he wants to give people a yardstick when it comes to cryptocurrencies and the environment. In fact, the authors point out that Bitcoin is often referred to as the extraction of “digital gold“. But the production of carbon dioxide far exceeds that of gold mines.
The fact that Bitcoin consumes a lot of energy is well known to those involved in cryptocurrencies. But quantifying the impact is more complicated. The study authors note that in 2020, Bitcoin mining (the cryptocurrency production operation) consumed 75.4 terawatt-ora. A consumption that exceeds the energy consumed by nations such as Portugal (70.4 TWh per year) and Austria (69.9 TWh per year). Important figures, albeit far from the Italian needs (about 300 TWh per year).
The impact on the market value
However, the authors wanted to compare energy consumption with the value of Bitcoin on the market, to understand when production is efficient. To then compare this data to other industries.
As of December 2021, Bitcoin was worth 960 billion dollars and counted for the 41% of the global value of all cryptocurrencies. On December 31, 2021, Bitcoin was worth $ 41,659.19, while today it is worth less than half: 19.952,04 euro.
In 2021, every Bitcoin created caused it according to the authors $ 11,314 in environmental damagefor a total of approx $ 12 billion in global damages. It is therefore worth about a quarter of the average value of the coin during the year.
Furthermore, the authors point out that the value of environmental damage has increased by 126 voltewith issues of 0.9 tons per coin up to 113 tons per coin today. The worst time turns out to be May 2020, when the damage to the value of the coin has touched quota 156%: every dollar of value produced generated $ 1.56 in damage.
More than breeding for the production of beef
This data is undoubtedly influenced by the very variable value of Bitcoin. In mediathe authors estimate that the damage to the climate is worth the 35% of the market value. A value that exceeds that of the production of beef (33%) and that is not even comparable to the impact of mining oro (4%). Among the other activities considered by the researchers, only the production of energy generated in it exceeds Bitcoin for environmental impact gas-fired thermoelectric power plants (46%) and the production and distribution of gasoline (41%).
As always when evaluating a scientific study, it should be borne in mind that the team’s evaluations will need to be confirmed by independent studies to have true value. We imagine they can dispute the way assess the environmental damage and how they view cryptocurrency fluctuations.
But the meaning behind this study remains emblematic: environmental damage is worth one third of the value of the mined currency, on average. Costs that are outsourced to all of us, not just those who trade Bitcoin. And given the process for manufacturing, many experts are skeptical that Bitcoin can reduce its environmental impact. So the question is: is it worth it?