The ‘Ground-Breaking’ and ‘Water-Shed’ Moments of Bitcoin Mining

• 1 Bitcoin makes up more than half of the crypto market today.
• 2 One BTC transaction is allegedly equivalent to a Million VISA transactions.

From electricity consumption to carbon emissions, the ones aware of crypto mining are well-versed in the ongoing debate of how behind the scenes are crippling the environment. A recent study conducted during 2020 and 2021 by the intergovernmental organization, United Nations, goes beyond carbon footprints, throwing light on other ghastly facets of Bitcoin (BTC) mining.

The Wingspan That Went Unnoticed

While the world is focusing on its impact on the ozone, the authors of the study decided to extend their vantage point to a bird’s-eye view. The research published by United Nations University and Earth’s Future journal dated October 24 2023, reveals how Bitcoin mining is affecting land and water alongside air.

The global water footprint of BTC mining during the period covers nearly 1.65 Km³ while the land footprint extends to nearly 1900 Km³. The numbers translate access of water to 300 Million Sub-Saharan Africans and a land mass covering 1.4 times the area of Los Angeles.

Cryptocurrencies operating on the Proof-of-Work (PoW) consensus mechanism are more energy-intensive than that of Proof-of-Stake (PoS) crypto assets. The report notes that the cumulative energy required to run a Bitcoin network is equivalent to powering millions of households in countries including the United States, Japan, Germany, and more.

This kind of energy consumption can put the crypto market on a path to become among the largest polluters globally. Moreover, Bitcoin mining alone can “push global warming beyond the Paris Agreement’s goal of capping anthropogenic climate warming below 2 degrees Celsius,” highlights the report.

Bitcoin mining is heavily dependent on fossil fuels, specifically coal. The activity generated 82.89 Mt of CO₂, which is equivalent to “84 billion pounds of coal burned, 190 natural gas-fired power plants, or over 25 million tons of landfilled waste.” Almost 4 Billion plants should be planted according to the research to cool off the heat of such propensity.

Once a crypto mining powerhouse, China’s crackdown on the crypto sector shifted the balance of hashrate, a metric explaining power consumed by crypto mining, to countries like the United States and Kazakhstan. It has, in turn, also transitioned the share of carbon emissions arising from coal burning. China accounts for nearly half the global coal production.

However, China’s decision led to a significant decline in carbon, water, and land footprints associated with Bitcoin mining. Still, it is heavily dependent on fossil fuels according to the study. The share of natural gas in the BTC mining energy mix has increased from 15 percent to 21 percent during 2020 and 2021.

Footprints from crypto mining vary from country to country, putting down to their energy mix. For instance, Canada ranks sixth among the top Bitcoin mining countries, but ninth in terms of carbon emitting from the activity in the nation attributing to “higher role of nuclear and natural gas in its energy supply portfolio.” The ranks swap places in context to Ireland, owing to its fossil fuel dependency.

Countries including Thailand, the United Kingdom, and Sweden are not among the top Bitcoin mining nations, however, they contribute significantly to the crypto asset’s land footprint. Moreover, the top ten “countries  with  the  most  land-intensive BTC operations are responsible for 93% of BTC’s global land footprint.”

Cryptocurrency prices are a major driver of crypto mining activities. It also decides the intensity of carbon emissions arising out of the activity. While miners find greenhouse gas (GHG) emitting cheap fuels more compelling during a cold market, higher prices compel them to use expensive but clean power sources.

The report also notes their anonymous nature makes it harder for lawmakers to track the assets’ activities. The authors write, “Due to its nature, cryptocurrency mining  activities are hard to track, creating barriers to the regulation of the crypto market and its imposed load on the power grid.”

Although uncertain, analysts have forecasted Bitcoin to reach as high as $250K following halving, a recurring event cutting BTC rewards for mining in half. Georgia, Texas, Kentucky, and New York are top spots for Bitcoin miners in the US. Texas and New York are among the States prone to power outages. An increase in crypto-mining operations may lead to instability of power grids.

Anurag S

Anurag is working as a fundamental writer for The Coin Republic since 2021. He likes to exercise his curious muscles and research deep into a topic. Though he covers various aspects of the crypto industry, he is quite passionate about the Web3, NFTs, Gaming, and Metaverse, and envisions them as the future of the (digital) economy. A reader & writer at heart, he calls himself an “average guitar player” and a fun footballer.