According to new research, Bitcoin has grown less green since China cracked down on cryptocurrency mining.
Mining is the process of creating new bitcoins with the help of large clusters of powerful computers.
Miners stopped utilising Chinese hydro and migrated to the United States, where gas supplies majority of their electricity, and the amount of renewable energy powering mining decreased from 41.6 percent in 2020 to 25.1 percent last August.
Bitcoin, according to researchers, now emits carbon emissions similar to Greece.
“We see the network becoming less green than ever before,” said Alex de Vries, one of the study’s authors, who was published in the peer-reviewed journal Joule.
Renewable energy has been viewed with more optimism by industry groupings.
Previously, the Bitcoin Mining Council projected that the “sustainable electricity mix of the worldwide mining business has grown to around 58.5 percent.”
In order to maximise their income, bitcoin miners will often try to relocate to areas with plentiful inexpensive electricity.
Large quantities of electricity are consumed by the specialised computers that verify crypto transactions.
In the past, Bitcoin miners in China would migrate during the rainy season from provinces with cheap fossil-fuel electricity to those with plenty of hydropower.
However, by June 2021, mining had all but disappeared in China, thanks to prohibitions in major provinces.
After being forced out of China, mining shifted to the United States and Kazakhstan.
The shift to the United States increased the consumption of fossil fuels, particularly natural gas.
“Only a small portion of the US grid is derived from renewable energy sources,” Mr De Vries remarked. He went on to say that many crypto-mining-friendly states, such as Texas, Kentucky, and Georgia, did worse than the national average in terms of renewable energy generation.
According to the researchers, Kentucky, for example, “offers tax advantages to attract Bitcoin miners and thereby saves coal firms.”
According to the researchers, Kazakhstan has coal-fired power plants that burn “hard coal,” which is more polluting than its Chinese equivalents.
According to the study, bitcoin emits more than 65.4 megatonnes of carbon dioxide per year.
Greece, on the other hand, emitted 56.6 megatonnes of carbon dioxide in 2019.
Mr De Vries stated, “The carbon footprint of a single bitcoin transaction will be around 669 kilos of carbon dioxide.”
He compared it to the carbon footprint of a flight from Amsterdam to New York per passenger.
According to the calculator from the UN’s civil aviation organisation, the International Civil Aviation Organization, an economy-class return flight from London to New York releases an estimated 670kg of CO2 per person.
Mr. De Vries and his co-authors claim that their study demonstrates the necessity for the crypto business to step up its efforts to reduce carbon emissions.
One such initiative is the Crypto Climate Accord.
Its members have committed to achieving net-zero emissions from crypto-related electrical use by 2030.
However, according to the research, it is a long way off.
The authors conclude, “A speedy solution to Bitcoin’s carbon footprint is not in sight.”
Mr. De Vries believes it demonstrates the importance of international cooperation.
“China chose to prohibit cryptocurrency mining, but we now see that this has had a negative impact,” he stated.
