Berlin — The virtual currency bitcoin is responsible for the same amount of carbon dioxide emissions as a city like Las Vegas or Hamburg and efforts to reduce its climate footprint should be considered, researchers said Thursday.
A study by researchers at the Technical University of Munich and the Massachusetts Institute of Technology, examined how much power is consumed by computers used to generate bitcoins and process transactions. Writing in the journal Joule, researchers said they then combined the results with the carbon emissions from electricity production in the countries where the computers were located.
They concluded that, in late 2018, the entire bitcoin network was responsible for 22-22.9 million tons of CO2 per year — similar to a large Western city or an entire developing country like Sri Lanka. Total global emissions of the greenhouse gas from the burning of fossil fuels were about 37 billion tons last year.
“There are bigger factors contributing to climate change,” said Christian Stoll, one of the study’s authors. “However, the carbon footprint is big enough to make it worth discussing the possibility of regulating cryptocurrency mining in regions where power generation is especially carbon-intensive.”
This report comes a few months after JP Morgan Chase concluded the cost of mining Bitcoin is far outstripping what miners can fetch on the market. These miners are located all over the globe. Researchers said about 68 percent of the computing power used to generate, or mine, bitcoins is in Asia, 17 percent is in Europe and 15 percent is in North America.
CBS News reported on the power required for cryptocurrency mining in the CBSN Originals documentary, “Cryptocurrency: Virtual Money, Real Power.” Cryptocurrency like bitcoin is generated by multiple computer servers that use huge amounts of electrical power and require additional energy for industrial fans that cool the servers. Because access to cheap power is key, crypto miners are racing to set up shop anywhere in the world they can find low rates, preferring cold climates to help reduce cooling costs. The technology itself has proven to be hugely profitable for some.
But this tech boom is not without problems. Among the issues: the droning noise of all that equipment. The hum reverberates far beyond the walls. And some of the operations have sprung up in a decidedly makeshift fashion.
Alex de Vries, a bitcoin researcher who wasn’t involved in the study, questioned whether the method used to determine the location of computers was reliable enough. But de Vries said the emission figures were consistent with those he had calculated using a different method, and could possibly even be on the low end.
“The folks in this study were very conservative on the energy side,” he told The Associated Press. Others have argued concerns about bitcoin’s energy consumption are overblown and oversimplified.
The environmental impact of bitcoin, which is the most important virtual currency, has long been a concern, especially given its limited uptake. Last year the bitcoin network processed about 81 million transactions, compared to 500 billion transactions handled by the regular global banking system, said de Vries.
“If you look at the carbon footprint per transaction, that’s where the real shock is,” said de Vries, estimating it at about 271 kilograms of CO2 per transaction — or several hundred times that of a standard credit card payment. “That’s insane.”