Concerns about Bitcoin and its environmental impacts aren’t new, but a study from Technical University of Munich (TUM) is – and its authors conclude that the current carbon footprint is equal to that of the German city of Hamburg or Austria’s Vienna.
The scientists, led by Christian Stoll of TUM and Massachusetts Institute of Technology (MIT) in the United States, said they had to do a bit of detective work to arrive at what they say is the most detailed calculation to date of how much the cryptocurrency is costing the planet.
“Although the currency Bitcoin is virtual, the energy consumed for its use is real,” said the research team, whose work is newly published in the journal Joule. “The computer capacity used for this so-called mining of bitcoins has risen sharply in recent years. Statistics show that it quadrupled in 2018 alone.”
Their answer on emissions is between 22 and 22.9 megatons of carbon dioxide annually, making it comparable to Hamburg, Vienna, or the entire nations of Jordan or Sri Lanka.
First, the research team identified the network power consumption, which depends primarily on the ASIC miners equipment used for bitcoins. “In 2018, the three manufacturers dominating the market for ASIC miners planned to go public,” the TUM team said. “From the documents they had to publish, the team was able to calculate the market shares of each model.”
All told the energy impact involves 45.8 terrawatt hours, as of November 2018, but from there they had to tease out differences. Professional Bitcoin mining operations are set up as data centers that require cooling, for example, as opposed to individuals plying the trade at home, and they all had to be included in the accounting.
To understand the current power demands and impacts, they also needed to look at how and where the energy was being generated. “Speculations about the Bitcoin network’s source of fuel have suggested, among other things, Chinese coal, Icelandic geothermal power, and Venezuelan subsidies,” the authors said.
Yet the two largest Bitcoin “mining pools” showed TUM’s team that miner IPs came from their own or nearby countries. By following the trail, and using other methods to verify the results, the researchers found that 68 percent of the computing power used for Bitcoin networks was in Asian nations, with another 17 percent in Europe and 15 percent in North America.
“Bitcoin’s power consumption may only be the tip of the iceberg. Including estimates for three other cryptocurrencies adds 30 TWh to our annual estimate for Bitcoin,” the authors warned.
While there are plenty of emerging scenarios in which blockchain and cryptocurrency technologies are seen as climate solutions, the authors say much of the debate is focused on benefits and not enough attention is given to costs. These include the related carbon emissions, but also the concentration of power in the hands of a few cryptocurrency players and whether or when government control is warranted.
“Even though there are more important factors for climate change, the carbon footprint is so great that it offers reason enough to discuss regulation of crypto-mining at locations with CO2-intensive power production,” said Stoll. “To improve the ecological balance, for example, it would be possible to link more ‘mining farms’ to additional generation of renewable energy.”