Bitcoin mining has an environmental impact on par with the most polluting activities on the planet. This is the result of a new study published in the journal Nature. It is one of the most complete reports to date, analyzing data from 2016-2021 and confirming a fact we have been warning about for years.

More pollutants than oil extraction. In 2020 alone, Bitcoin mining consumed 75.4 TWh of electricity per year, more than countries like Austria or Portugal. The trend is that Bitcoin is increasingly polluting, going from 0.9 tons of CO2 to 113 tons last year. 126 times increase in your lifespan.

To get an idea, the researchers explain that for the equivalent of every dollar produced in BTC, 35 cents represents environmental damage. That’s a huge amount for an activity equal to gasoline or meat production and almost as much as natural gas. Bitcoin is hardly mentioned when talking about highly polluting activities, but this study confirms that we should start to include it.

Unlimited emissions. Another concern of the authors is that emissions are increasing from year to year. Bitcoin emissions were expected to be moderate with maturity, but that was not the case. Only China’s ban on Bitcoin mining has had an impact in reducing emissions.

If BTC proponents referred to this cryptocurrency as “digital gold”, the truth is that it eventually became a kind of “digital oil”. An asset of high value but with a very serious environmental impact. Gold production has a 4% effect on its value, while Bitcoin averages around 35%. Similar to gasoline (41%) or beef (33%) production.

1 BTC = $11,314 in air damage. According to the study’s calculation, approximately 11,000 euros were generated in environmental damage for each bitcoin produced in 2021. To get an idea, this represents a total of $3.7 billion in damage to nature. Only in 2021. Looking back, it assumes that Bitcoin caused $12,000 million in losses.

Almost as polluting as coal. The last mining boom was a real environmental hole. Bitcoin’s impact has reached insane levels, similar to that of coal. At this point in May 2020, Bitcoin’s shock completely surpassed its own value. So much so that for every dollar produced, $1.56 in environmental damage was created. 156%.

Despite the promises, the future is so uncertain. The study also talks about the use of renewable energy for Bitcoin mining. However, he is quite skeptical about its ultimate impact. Even in an optimistic scenario where renewable energy use increases by 50%, the impact of Bitcoin would still be 23% of the currency’s value.

Organizations that support cryptocurrencies advocate radical changes to their code to reduce their consumption. We saw this with Ethereum 2.0, which was promised a 99.95% drop. We will have to wait for these improvements to reach Bitcoin as well. What we have now is that Bitcoin has already left a tremendous environmental impact in its short lifespan.

Image | Jernej Furman