The huge carbon footprint and massive energy use of online activities and of Bitcoin

Graphic courtesy of Alice Eaves on Rehabilitating Earth website

This is a most timely article.    Why is  the world not noticing this?   Elon Musk and other billionaire Bitcoin fans are also fans of space travel –   another energy-gobbling thing.   They are fans of nuclear energy.  The thing that nuclear energy fans have in common with space travel fans and Bitcoin fans is their religious fervour for endless growth and endless energy use.

Unfortunately our entire culture, the Western consumer culture, has swept the world  with a mindless belief in ever more stuff, ever more digital use, with no awareness of the  energy used.   So we tink that our billions of trivial tweets are up ”in the cloud”, – not even realising that they are in dirty great steel data buildings that use massive amounts of energy just to keep cool, This ever- expanding energy and resource gobbling is going to kill us, – and Bitcoin is just one glaring, sorry example of this.

Truth or fiction: Is mining bitcoin a ticking time bomb for the climate?  Rehabilitating Earth   By Jennifer Sizeland 2 May 21

While many of us may consider the carbon footprint of buying a physical item like a jumper or a toaster, it is truly mind boggling to think about the environmental impact of time spent online. This may be why the huge carbon footprints of cryptocurrencies like bitcoin are going largely under the radar for many of us, including investors and climate activists.

Yet the real-world cost of bitcoin cannot be underestimated. A University of Cambridge study found that the network burns through 121 terawatt-hours per year, putting it into a category of a top-30 country in terms of electricity usage. In fact, the carbon cost was largely ignored altogether until 2017 when prices surged and the general population started to take more notice. Aside from the significant carbon footprint of bitcoin, it’s important to understand what bitcoin is and why it’s so popular.

Decoding Cryptocurrencies

Bitcoin is created by mining a 64-digit hexadecimal number (known as a ‘hash’) that is less than or equal to the target hash that the miner is looking for. The miner gets paid in crypto tokens for all the currency they make. The act of solving these computational equations on the bitcoin network makes the payment network trustworthy. It proves the worth of the bitcoin and verifies it at the same time so that it can’t be spent twice. Essentially, an online log makes records of the transactions made and once approved, they’re added to a block on the chain, hence the phrase ‘blockchain’.

What makes it all the more confusing is that not only is cryptocurrency fairly new to the general population, but the way it is created is shrouded in secrecy due to its niche status. This makes it much harder for miners to be held accountable for their intensive carbon usage, in a time when every company needs to consider their impact on the planet.

The secrecy is also what excites investors about bitcoin since it isn’t tied to a certain location or institution and it’s completely decentralised – unlike a bank. Investors trust bitcoin as inflation is controlled algorithmically by cutting the reward rate periodically, rendering the rate of new bitcoin supplies as unalterable by design. The issue remains that there is no government or organisation to hold them to account for their carbon footprint. A footprint which is intrinsically tied to its value as the demand for it increases, using more and more energy. With every market jump, the cost to the planet is greater.

The price of one bitcoin is $57,383 at the time of writing, which takes the market cap value above that of Facebook and Tesla. The wider cryptocurrency market that includes dogecoin, ethereum and litecoin has reached an estimated $1.4 trillion and counting.


From a financial perspective, miners want cheap servers to increase their profit margins which is why much of the bitcoin activity is done in China. As the industry is unregulated there is no reason why activity wouldn’t surge in the place where it costs the least to do it. Currently, China does not have a cost-effective renewable energy supply so two thirds of the grid is fuelled by dirty coal power stations.

Another problematic caveat to the bitcoin story is the amount of so-called green companies and investors that are buying into it. Some of them are not disclosing this element of their portfolio due to the immense carbon footprint but those that are publicly traded have no choice. Perhaps one of the most high-profile companies to reap the rewards from bitcoin is Elon Musk’s Tesla, who have made $1 billion in 10 weeks from their investment. It remains to be seen whether these businesses are doing their due diligence regarding the origins of their bitcoin and if it is mined from a sustainable source. While this may give Tesla more money to invest in green infrastructure, it’s hard to say whether this is the more ethical way to do so……….

One important lesson we can take from this is that it demonstrates how the digital world has a very real impact on planet Earth. Whether we’re buying cryptocurrency or simply scrolling the internet, we are impacting the planet in one way or anotherhttps://rehabilitatingearth.com/2021/05/02/truth-or-fiction-is-mining-bitcoin-a-ticking-time-bomb-for-the-climate/

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