If you were to ask 100 people what is worse for the environment, Gold or Bitcoin, I would not be surprised if the majority said Bitcoin. However, they would be very wrong. Bitcoin and the energy crisis
A global campaign against Bitcoin appears to be focused on its likely impact on global warming. Greenpeace, for example, has created a campaign to petition for the changing of Bitcoin’s code with their website, “clean up Bitcoin.” The World Economic Forum shared a similar video in solidarity with the cause. However, neither of these organizations has submitted a Bitcoin (CRYPTO: BTC) Improvement Proposal (BIP) to action their campaign. Anyone on the planet can suggest changes to Bitcoin’s code and submit it for approval by the committee. No evil lair or secret society needs to be infiltrated to change Bitcoin. All that is required is presenting a simple proposition, and you can be a part of “improving Bitcoin.” The fact that this has not happened may suggest no real goal for campaigns such as these. The goal is in the publicity of the message itself. Bitcoin “fuels the energy crisis,” according to Greenpeace. However, what does this mean? Let’s look into some of the data behind the argument that Bitcoin is a significant contributor to the downfall of our climate. To mine Bitcoin, you need specialized ASIC miners who use, on average, around 3KWh of energy. This is about two electric kettles or one medium-sized electric heater. The Bitcoin miner runs at this rate 24/7, and for over a year, a single, modern miner of this size could mine around 0.16 BTC or around $4,700 at the current price. However, this does not account for the cost of the electricity to run the miner. When the electricity cost is factored in, using an average price of $0.12KWh, the profit drops to just $1,500. The miner is still profitable, but it costs the owner around $3,200 in additional utilities. Owning a small Bitcoin farm of 5 units would cost around $16,000 per year in electricity costs alone. In a world where most adults have been brought up being told to make sure you turn the light switch off when you leave a room, it is no wonder that this appears like a tremendous waste of energy. It is undoubtedly a vast use of power but is it a waste? And does it contribute to greenhouse gases? Bitcoin mining emissions
Bitcoin mining is not extremely common in non-commercial scenarios in 2022. Companies with direct links to power generation can mine Bitcoin at a much lower cost per KW, and thus most mining is done through mining companies such as Hut8, Riot Blockchain and Marathon. Several of these companies are a part of the Bitcoin Mining Council, which, earlier this year, released a report that indicated over 58% of Bitcoin mining uses renewable energy. Assuming that the other 42% is all mined using natural gas power plants would equate to roughly 23 megatons of carbon dioxide being released into the atmosphere each year. That is the equivalent of 23 million VW beetles or 230 thousand fully occupied coaches. At the current rate of global emissions, this makes up 0.07% of CO2 released into the atmosphere. While 23 million cars may seem like a lot, global emissions total 31,500 megatons disturbingly.
Gold and greenhouse gas emissions
Gold, however, releases 100 megatons of CO2 annually, which is over five times the amount associated with Bitcoin. Further, there is a direct link between greenhouse gas emissions and gold mining. Over 1 ton of CO2 is created for each ounce of gold produced. Gold production results in wasteful CO2 as a direct output of the production process. Bitcoin, however, only has an indirect link to any greenhouse gas emission at all. Bitcoin uses electricity, which, when generated by natural gas, results in CO2 emissions. Bitcoin mining is no different from running a traditional server farm similar to Amazon, Google, or Microsoft. The mining of Bitcoin itself generates zero greenhouse gases. If Bitcoin moved to 100% renewable energy sources for its electricity supply, it would be the cleanest form of currency production. No other currency has ever had a direct correlation between energy and money supply. There is no waste creation in the mining of Bitcoin in any sense. Bitcoin is close to 100% efficient in generating its money supply. Neither gold nor fiat can even come close.
This article was submitted by an external contributor and may not represent the views and opinions of Benzinga.