StockApps reckons that the carbon footprint of verifying a BTC transaction is 22 times larger than that of mining Gold of an equivalent value. Its analysis shows that mining one BTC produces 332 tons of Carbon dioxide while mining Gold of similar worth emits 15 tons of CO2.
“It takes 596,000 kWh to verify a single BTC transaction compared to the 25,000 kWh it does to mine Gold of the same value,” holds StockApps’ Edith Reads. She adds, “This directly affects the emissions resulting from both processes. This is significant as it suggests BTC does more damage to the environment per unit than Gold.”
BTC is no stranger to criticism
Bitcoin has always attracted criticism for its excessive energy consumption. Estimates show it consumes as much power as Thailand (191 TWh). That consumption level gives BTC a Carbon Footprint of nearly 107 metric tonnes, comparable to the Czech Republic’s.
Its mining relies on a Proof-of-Work consensus requiring miners to spend enormous resources to produce a tiny amount of coins for a profit. The more coins they produce, the higher their daily reward. But that also translates into more waste production owing to increased power consumption.
To compound matters, the coin’s computational power requirements have been increasing fast. While this increase helps maintain BTC’s scarcity and hence value, it comes with exponential growth in power requirements leading to further strains on the environment.
Greening BTC mining
There’s unanimous agreement that BTC mining should adopt more environmentally sound means. One proposal that’s come up in conversations surrounding BTC sustainability is the use of alternative fuels. Stakeholders are pushing for adopting renewables like geothermal, solar, wind, and hydropower.
A more radical suggestion is to transition BTC mining to the Proof-of-Stake Consensus, which is less energy and hardware intense. Finally, BTC mining firms can partner with credible carbon offset programs in mitigating climate change. That can go hand in hand with the adoption of energy-efficient mining equipment.