Crypto mining, natural resources, and the environment are hot topics for governments and the crypto market at present.
China’s ban on Bitcoin (BTC) mining put the spotlight on crypto mining and the environment. While governments have taken greater interest, manufacturers of crypto mining equipment have yet respond to the increased level of scrutiny, until now…
Crypto Mining and the Environment
Last summer, China’s outright ban on crypto mining was in support of the government’s carbon neutral goal by 2060.
Amidst an ongoing energy crisis in Kosovo, the Kosovo government was forced to impose a blanket crypto mining ban at the start of the year. The government imposed the ban to curb energy consumption.
In terms of Bitcoin hashrates, Kosovo only accounted for 0.01% of Bitcoin’s global hashrate in August 2021. According to Cambridge Centre for Alternative Finance, the United States was the largest Bitcoin mining nation, accounting for 35.4% of the total Bitcoin mining hashrate as at August 2021.
The U.S had accounted for just 16.85% of the total hashrate in April 2021. Mainland China had been the largest crypto mining nation before the summer 2021 ban.
For governments with carbon neutral aspirations, the impact of Bitcoin mining on the environment is significant. Such is the extent of energy consumption that, if Bitcoin were a country, it would be a top 30 energy consumer.
Considering energy consumption and climate impact, some key mining stats are worth considering:
- According to Columbia Climate School, Bitcoin is thought to consume 707KwH per transaction. In addition, there are also mining computers that heat up and need cooling.
- The University of Cambridge estimated that Bitcoin mining consumes 121.36 terawatt-hours (TWh) per year.
- According to estimates, Bitcoin mining yields 22m to 22.9m metric tons of CO2 emissions each year.
- In terms of global warming, Bitcoin mining could push global warming above 2 degrees centigrade in less than 3-decades.
U.S Government Climate Goals
It therefore comes as little surprise that Bitcoin mining has appeared on the radar of the U.S government. Optically, inaction as the world’s largest Bitcoin mining nation would go against the U.S emissions goals.
In April 2022, President Biden announced a new target for the U.S “to achieve a 50-52% reduction from 2005 levels in economy-wide net greenhouse gas pollution in 2030”. Upon taking office, President Biden rejoined the Paris Agreement, aiming to tackle the climate crisis both domestically and abroad. The U.S has a goal of reaching net zero emissions by 2050.
With Biden’s new U.S target, tomorrow’s U.S Congress subcommittee hearing on cryptos will draw plenty of interest.
When considering China’s ban and the increased interest in crypto mining, more energy efficient mining equipment would be a next step in addressing environmental concerns.
Intel Looks to Deliver a Major Breakthrough in Bitcoin Mining
Overnight, news hit the wires of Intel (INTC) entering the Bitcoin mining space. According to the news, Intel plans to introduce a new “Ultra-Low-Voltage-Energy-Efficient Bitcoin Mining Asic”. Reportedly called Bonanza Mine, Intel plans to introduce the mining Asic next month. The Bonanza Mine is said to “reduce overall power consumption by approximately 15%”.
A 15% reduction in power consumption is a step in the right direction. Intel’s move into the Bitcoin mining space will also likely force other mining equipment manufacturers to look at improving power consumption inefficiencies.
Such an outcome would be positive, not just for Bitcoin miners, but also for the environment.