Yesterday, The New York Times published an interview with Bill Gates conducted by Andrew Ross where the billionaire emphasized how dangerous Bitcoin is for the environment. It really is that?
Bitcoin: An Environmental Destroyer?
Clearly Bitcoin through its bull run has increased its appeal and, with it, its demand. However, now the world is wondering if the huge environmental cost that Bitcoin represents according to some is worth it.
In this regard, Bill Gates assured Ross that Bitcoin uses more electricity per transaction than any other method known to mankind. Previously in CryptoTrend we have mentioned the various studies that conclude that the annual carbon emissions of the electricity generated to extract and process Bitcoin is equal to the amount emitted by New Zealand or Argentina.
Consequently, some tend to underestimate the impact. But, what Gates sees are the fallout from something the crypto community yearns for every day: Mass adoption.
As many will know, given the way Bitcoin works, as it becomes more popular, its carbon footprint, and therefore environmental impact, increases. In fact, according to DW, Bitcoin’s energy consumption has increased tenfold since 2017.
How important is the impact?
According to the BBC, researchers from the Judge Business School of the University of Cambridge created an analysis tool that calculates the real energy cost of Bitcoin. Therefore, they found that it uses approximately 130 terawatt hours.
The issue is worrying when researchers point out that the annual electricity consumption of Bitcoin exceeds the annual consumption of countries such as the United Arab Emirates, the Netherlands, the Philippines, Belgium, Austria or Israel.
However, it is also valid to look at another relevant point. Turns out, according to Arcane Research, Bitcoin’s carbon footprint is miniscule when compared to other digital industries.
According to DW, data centers globally – those running Big Tech, the cloud, the internet, and today’s financial system – require roughly 200 terawatt hours of electricity per year and Bitcoin only needs half that amount.
Obviously no one can deny that Bitcoin has an impact on the environment, however, that does not make it worse or better. But, without a doubt, Bitcoin could reduce its environmental impact if it used alternative energy sources.
It is worth noting that, as many know, the main mining networks in the world have been centralized in China, a country that obtains much of its energy from fossil fuels such as coal.
In fact, Bill Gates said that if you use green electricity and don’t replace other uses, eventually, you know, maybe that’s okay, according to Entrepreneur. So yes, Bitcoin does have an impact on the environment and that worries Gates about that, however there is room for improvement.