Will Bitcoin mining ‘boil the ocean’?

Study Claims Bitcoin Mining Will Increase Global Temperatures Within Decades

A recently published study has made the apocalyptic claim that Bitcoin mining will lead to an increase in global temperatures by 2°C within the next couple decades. If the research is accurate, the mining of Bitcoin will conflict with the goals of the 2015 Paris Agreement, which sought to limit the rise of global temperatures to just 1.5 °C. The study, “Bitcoin emissions alone could push global warming above 2°C”, published in the journal Nature Climate Change, is only the latest in a number of papers, articles, and studies attempting to understand the electrical costs and environmental impact of mining cryptocurrency. 
 
 The trouble with bitcoin mining relates to Bitcoin’s proof-of-work algorithm which requires complex mathematical equations to be solved and in turn requires a large amount of electricity. For the new study, researchers with the University of Hawai’i at Mānoa compiled data on electricity consumption of the current computing systems used in Bitcoin verification, as well as the CO2 emissions from electricity production in the countries of the companies that perform the computing. The researchers found that around 314.2 billion cashless transactions are carried out every year with Bitcoin accounting for only about .033% of these transactions in 2017.

“The environmental concern regarding Bitcoin usage arises from the large carbon footprint for such a small share of global cashless transactions, and the potential for it to be more broadly used under current technologies,” the researchers write. According to the researchers, if the current rate of adoption is similar to some of the “slowest broadly adopted technologies” the total CO2 emissions resulting from Bitcoin use will propel global temperatures beyond the 2 °C threshold within 22 years. If Bitcoin mining is adopted at the fastest rate which other technologies have been adopted, the researchers expect this temperature to be reached within 11 years.

The researchers note that this problem might be avoided if companies lose interest in solving the proof-of-work algorithm for each block of transactions as rewards are halved approximately every four years. “Reducing Bitcoin’s carbon footprint should not rest solely on some yet-to-be-developed hardware but include simple modifications to the overall system, such as adding more transactions per block or reducing the difficulty or time required to resolve the proof-of-work,” the team states. Further, the researchers recommend that further development of cryptocurrencies should “critically aim to reduce electricity demand”. 
 
 The paper has been criticized by Bitcoin enthusiasts and energy experts who downplayed the claims based on the methodology. Several critics have pointed out the difficulty of extrapolating Bitcoin’s electricity use based on current data. This is because Bitcoin mining is dependent on several factors, including Bitcoin’s value, the cost of electricity, the efficiency of the mining equipment, and government regulation. Other critics believe technological innovation will lead to further developments in so-called “green mining”.

Axios was also critical of the study, writing that “the projections assume that the fuel types used to generate electricity will remain the same as they are today”, and the researchers ignore “the rapid rise of renewables worldwide”.