Environmental Implications of Cryptocurrencies and Blockchain
Problems and Solutions
In the wake of woke culture, the environmental impact of cryptocurrencies is worth discussing. Every level-headed tech enthusiast would agree that at the top of innovation should be responsibility, lest we destroy the human race.
Unsurprisingly, blockchain as a revolutionary tech tool needs a touch of responsibility. That comes after substantial evidence points out the environmental hazards that come along with blockchain technology.
There are three ways in which cryptocurrencies and blockchain negatively impact the environment. These are electronic waste, excessive carbon dioxide emission and high energy consumption, which loops back to excessive carbon dioxide emissions.
Let’s start with E-waste(electronic waste). Cryptocurrency mining machines undergo rigorous computations, which vastly reduces their shelf life. As a result, they frequently get replaced, rendering most computers useless. The major problem comes when these pieces of electronics get dumped.
See, computer boards contain hazardous elements like lead and mercury. These chemicals eventually end in water bodies, affecting humans and animals.
On the other hand, improper recycling of electronic waste means a gap in valuable elements in scarce minerals like cobalt, indium and neodymium, which is essential in producing magnets. To fill this gap, we must double down on reserves that’d sustain future generations. I don’t know about you, but it sounds irresponsible to me.
Let’s not forget that these electronic components require energy to produce; thus, when we dump them, we dump tons of energy and human effort, which is irreplaceable.
Furthermore, we have a giant carbon dioxide footprint to address. So from the beginning, using much computational power, crypto rigs draw much more than necessary electrical power. For instance, the bitcoin network draws enough energy to power Argentina and other small countries. What is more frustrating is that 90% of computers participating in the mining don’t build the blockchain; instead, they provide competition and, in some sense, security. In another dimension, Proof of Work(PoW) mining is a perfect way to waste energy.
In addition, more than 70 % of PoW energy comes from China which substantially relies on coal. Following that logic, you can interpolate how much carbon dioxide. In the past, cryptocurrency mining produced an excess of 100 million metric tons of carbon dioxide, comparable to diesel-powered trains.
Carbon dioxide emission is not any more hazardous than the mere use of exorbitant energy. For reference, at some point, a single Ethereum transaction used enough energy to power the average U.S household for 8.3 days. An inherent problem of overusing energy is higher Energy costs, reduction and climate change. These challenges are not selective; they affect blockchain enthusiasts like a blockchain critic. It’s pertinent that we keep our eyes on these challenges.
Perhaps the above paragraphs meant something to you, but do they nail blockchain to its demise?
I can’t say, but l genuinely hope they don’t.
When introducing new technology, making it efficient in all dimensions is often a slow and painful process. I’d believe the same applies to blockchain. It will be a long journey of trial and error until we find a sweet spot where we can enjoy the technological innovation part without having to worry about environmental hazards.
With blockchain, we are not by any means approaching a dead end. They are a handful of ways we can mitigate the challenges brought forward by crypto mining.
The most direct way is to remove the competitive aspect of mining in blockchains like bitcoin. See, if we have 1000 miners trying to add a block, all of them will use exorbitant amounts of energy, but only one miner will find the correct hash. The rest are just providing competition to ensure legitimacy, simultaneously wasting energy in many ways.
On top of that, mining difficulty is directly proportionate to the number of miners. A considerable influx of crypto miners will back-to-back encourage energy waste. For one, it means more high-energy demanding computers connected to the network. Secondly, the mathematical problem to be solved to add becomes harder, thus requiring more computational power. That all translate to higher energy consumption.
An alternative to this system would be the replacement of PoW(Proof of Work) with PoS(Proof of Stake). PoS pivots on who has the most significant stake in the coin, and it only makes sense to give them the responsibility of securing the blockchain. Therefore miners with the highest stake in the currency inherently become the primary auditors of the network.
Another way would be to reduce the number of miners. Perhaps by raising the entry threshold through licensing ownership of mining rigs or making them more expensive. As it stands, you only need $500 to start mining. Of course, that has its pros and cons, but I feel it is worth considering.
From another perspective, if mining pools adopt renewable energy sources, they’d significantly improve the carbon footprint. The vast majority of crypto mining is leaning on natural gas and coal; a shift to renewables will vastly make the industry sustainable. To be precise, this means doubling down on solar energy, hydro-power and harnessing wind energy.
Blockchain also has a unique way of participating in carbon offset programs. For instance, if we make blockchain systems that provide transparency and accuracy on carbon dioxide emissions throughout the value chain, blockchain becomes a tool against environmental hazards by ensuring accountability.
Moreover, we can reduce inefficiencies in logistics that cause unnecessary energy loss by adopting blockchain-based smart contracts between retailers and suppliers. Perhaps that will never be enough to compensate for 100 metric tonnes of carbon dioxide, but at least blockchain can pay for its sins.
The environmental impact of blockchain and cryptocurrencies is an ongoing discussion, and it should be as such till we reach sustainability. However, it is detrimental to ditch an entire system because of tolerable inadequacies that will go pale with time, research and development.
sources
adopted from derbymatoma.com
New to trading? Try crypto trading bots or copy trading
