Mining Bitcoin is as energy intensive as mining gold
Another study raises concerns about the high environmental cost of using cryptocurrencies. Samantha Page reports.
“Mining” for Bitcoins is just as energy intensive as mining for gold and other precious metals, a new study finds.
It takes between seven and 14 Megajoules (MJ) of energy to create a US dollar’s worth of cryptocurrency, more than the energy required to physically mine for a dollar’s worth of copper or gold, say Max Krause and Thabet Tolaymat, from America’s Oak Ridge Institute for Science and Education, in a paper published in the journal Nature Sustainability.
The energy cost is roughly equivalent to that of mining platinum or rare earth oxides and poses significant environmental issues.
“Bitcoin, like a mineral in the Earth’s crust, is finite and extractable and, like conventional mining, cryptomining can be energy intensive,” they explain.
The two researchers, working at the US Environmental Protection Agency’s Office of Research & Development, look at energy costs four cryptocurrencies: Bitcoin, Ethereum, Monero, and Litecoin. All four use blockchain, a digital public ledger, to record transactions. New currency is created, or “mined”, as a reward for performing calculations that process and log transactions by solving a cryptograph – and thereby adding a block to the chain.
These calculations can use a lot of electricity. While they are typically solved in about 10 minutes using specialised computer hardware, a typical computer would have to run for a year to solve a single calculation.
“The competitive process of adding blocks to the chain is computation-intensive and requires large energy input,” Krause and Tolaymat write.
Between January 1, 2016 to June 30, 2018, they find that mining one dollar’s worth of Bitcoin, Ethereum, Litecoin, or Monero used on average between seven and 17 megajoules.
“Comparatively, conventional mining of aluminium, copper, gold, platinum, and rare earth oxides consumed 122, 4, 5, 7 and 9 MJ to generate US $1, respectively, indicating that (with the exception of aluminium) cryptomining consumed more energy than mineral mining to produce an equivalent market value,” they find.
As Bitcoin and its fellow cryptocurrencies increase in prevalence, more and more people are raising concerns about the environmental impact of their energy usage. A study earlier this year found that Bitcoin consumes as much electricity as the country of Ireland and could account for almost half a percent of the world’s electricity usage by the end of 2018.
Since electricity is mostly generated by fossil fuels, such as coal and gas, its usage can have a significant environmental impact. For the 30 months included in Krause and Tolaymat’s study, “mining for all four cryptocurrencies was responsible for 3-15 million tonnes of CO2 emissions”, they say.
These new calculations come on the heels of a study released last month that found Bitcoin could single-handedly drive two degrees Celsius of global warming within the next three decades, due to carbon dioxide emissions related to its energy consumption.
But cryptocurrency adoption continues to climb. More than 100,000 companies accept Bitcoin, including Microsoft, PayPal, and Wikipedia.