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Learn how crypto mining can be a threat to the environment
Cryptocurrency mining is a very energy-intensive operation that jeopardizes the capacity of governments all over the world to lessen our reliance on fossil fuels, which contribute to global warming.
We won't achieve the objectives outlined by the Paris Agreement and the Intergovernmental Panel on Climate Change to limit warming to 2°C if we don't stop this expanding sector immediately.
This manual discusses several instances where local air, water, and noise pollution, cost increases for others, and climate pollution have been brought on by fossil-fueled cryptocurrency mining at a time when we should be doing everything in our power to move in the opposite direction to mitigate the worst effects of the climate crisis.
The U.S.'s Explosive Growth in Cryptocurrency Mining
After cryptocurrency mining was banned in China in 2020, there were many mining operations in the US.
The projected annual energy consumption of Bitcoin was 36 billion kilowatt-hours which is more than the combined annual energy consumption of Maine, New Hampshire, Vermont, and Rhode Island.
The previous two years showed that the sector prefers readily accessible energy and little regulation, reviving idle coal and gas facilities, flooding the Texas electricity market when it was reformed, and connecting to power systems where regulators have little control.
This rapid expansion burdens the energy infrastructure, drives retail electricity prices, and boosts global and local air pollution levels.
Because of how proof-of-work cryptocurrency mining is set up, miners are usually encouraged to scale up their operations regardless of the energy supply.
Indeed, large mining companies have demonstrated a willingness to invest in power sources that are ordinarily unprofitable, such as shut-down coal plants or gas plants with minimal capacity, as long as that electricity can be made available fast. Unlike other significant power consumers, most Bitcoin mining enterprises have demonstrated little interest in investing in new renewable energy, and they have a limited time horizon.
How Does Cryptocurrency Mining Work? What is it?
Mining cryptocurrencies using the proof-of-work algorithm is intended to use much energy. The approach involves a race between millions of computer devices to solve a challenging but pointless task.
The computer or mining device that correctly solves the issue is rewarded with Bitcoin, for instance, in the Bitcoin algorithm.
As long as the incentive is big enough, miners will attempt to use more and quicker mining machines to increase their chances of obtaining the payout.
The computational challenge becomes increasingly challenging as more mining equipment competes, and the power needed to win rises.
In these races, the power consumed by the miners grows exponentially over time.
Mining for Proof-of-Work Cryptocurrencies Increases Emissions in the US
Top-down estimates of the amount of power used for cryptocurrency mining in the US suggest that the sector produced an extra 27.4 million tonnes of CO2 between mid-2021 and 2022, or three times as much as the giant coal plant in the country did in 2021.
However, these projections are based on the anticipated energy needed to solve the cryptographic riddles.