HOW BITCOIN TRANSFORMs THE ENVIRONMENTAL LANDSCAPE
By Han Huynh
As society is increasingly growing with the precedence of manifold technological advancements, there is no doubt that in recent years, cryptocurrency has become more lively and dynamic than ever in our market. By now, you may have a question: what is virtual currency? Basically, cryptocurrency is a type of digital asset in which transactions are verified and recorded by cryptographic techniques without being controlled by central banks, government or management companies. Bitcoin is believed to be the most popular of more than 1000 cryptocurrencies that was created in 2009 by an anonymous group of people using a presumed pseudonym Satoshi Nakamoto.
WHY DOES BITCOIN ATTRACT THE INFLUX OF PEOPLE USING IT?
With cryptocurrency, transaction costs are very low, even non-existent. Bitcoin and Ether transactions can range from a few cents to several dollars. You can make transactions at any time, without limitations on buying and withdrawing funds. An individual in one country can send coins to someone in another country without any additional problems. Since cryptocurrency is not managed by any authority, participants can freely use it, unlike setting up a bank account, which demands paperwork procedures.
UNVEILING THE ENVIRONMENTAL IMPACT
However, the increasing number of people using Bitcoin may pose a detrimental influence on the environment. Bitcoin connects with consumers through computers or mobile devices, which means that it can’t exist without a source of electricity. Since the miners use Bitcoin, they are actually running programs on their computer that attempt to solve a complex mathematical problem. This process, known as proof-of-work, demands a huge amount of power, leading to ascending energy consumption. The more computing power you have, the greater your chances of reaping the rewards. When the puzzles become more difficult, the users are encouraged to provide more computer power to solve them and outcompete their competitors. This function of Bitcoin results in intense competition among users, driving up the energy consumption which directly affects climate change.
Cambridge University estimates that Bitcoin alone generates 110.53 TWh-more than the entire annual energy consumption of the Netherlands. As Bitcoin’s price rises, the amount of carbon dioxide emitted also grows. Bitcoin production is estimated to create around 23 million metric tons of emission per year, but in 2020, a survey conducted by University of Cambridge indicated that US bitcoin itself will produce 40 billion pounds of the consumption in 2020.
In the light of the debatable concerns about Bitcoin’s influence on the environment, there are some rising innovative solutions called “green cryptos” to pave the way for a sustainable mobility. These eco-friendly cryptocurrencies are designed to mitigate the environmental impact with primarily renewable energy sources to power the operations. It is important to note that the emergence of green cryptos is considered a remarkable measure to the digital currency. Awareness and collaboration in each individual also play a significant role in mitigating the impact of Bitcoin and other cryptocurrencies.
