How Bitcoin affects fossil fuels (press release)
Many academics and researchers have studied the relationship between cryptocurrencies and fossil fuels. While most of the world’s population has fallen in love with cryptocurrencies, there are raging concerns about their environmental impacts. Environmentalists and skeptics have continually questioned crypto mining’s vast energy consumption, contributing to the overreliance on fossil fuels, increasing carbon emissions, and climate change.
Bitcoin Mining and Fossil Fuels
Bitcoin mining is the most critical energy-consuming process in the Bitcoin network. It involves running sophisticated computational machines and servers to verify and validate Bitcoin transactions. Miners also solve complex mathematical puzzles to mint new coins. The activity requires vast amounts of computational power, resulting in significant energy consumption.
Bitcoin miners need reliable and vast amounts of energy supply since their machines run 24/7. Bitcoin’s proof-of-work mechanism creates a highly competitive platform, prompting miners to use sophisticated and powerful hardware to make substantial rewards. Bitcoin’s decentralized network comprises thousands of miners randomly distributed worldwide, competing for the incentives, resulting in enormous energy consumption.
The latest estimates show the Bitcoin network consumes as much energy annually as the entire country of Argentina. While Bitcoin mining occurs in different parts of the globe, China accounts for 65% of the world’s mining activities. The biggest concern is that China draws almost 60% of its energy mix from coal-powered plants.
Coal is one of the fossil fuels with the most significant environmental impacts, including carbon emissions and global warming. Waste piles of coal are environmentally hazardous, leaching contaminants into water resources, killing fish and other aquatic life. They are also highly flammable, increasing the risks of fires.
Burning coal in power plants cleans up some contaminants and releases carbon dioxide and other harmful greenhouse gases into the atmosphere. That is why environmentalists are concerned that increased Bitcoin mining in places like China that depend on fossil fuel sources would significantly increase the global carbon footprint.
Apart from China, many countries and regions today heavily rely on fossil fuels such as oil and natural gas to generate energy. Fossil fuels are currently the most reliable and cheapest energy sources, readily available in most parts of the world. That is why regions like China, Russia, and Kazakhstan attract a majority of miners, impacting enormous environmental degradation.
Mitigating Bitcoin’s Dependence on Fossil Fuels
There is no doubt increased Bitcoin mining through fossil fuel sources contributes to significant carbon emissions and global warming. The good news is that various alternatives now exist to help individual miners and crypto mining organizations break away from the yoke of fossil fuels, cutting energy costs and the industry’s environmental impacts.
Green Bitcoin mining is one of the alternatives, rapidly gaining a foothold in the industry. It emphasizes using clean, renewable energy sources such as solar and nuclear to mine Bitcoin. Numerous crypto mining companies now rely on solar energy to power their server farms. Genesis Mining is an excellent example of the leading companies that mine crypto with 100% renewable energy.
Many crypto businesses, including exchange platforms such as Immediate Bitcoin, have also begun shifting to renewable energy sources for their operations. Cloud mining is another alternative that could prevent the industry’s overdependence on fossil fuels. It is a commercial service, enabling miners to mine Bitcoin on server farms using renewable energy.
Unlike Bitcoin’s Proof-Of-Work system, newer blockchains use an energy-efficient mechanism known as Proof of Stake. Miners deposit a substantial amount of crypto for the rights to add blocks to the blockchain.
Bitcoin mining mainly encourages the overreliance on harmful fossil fuels, with dire environmental impacts. However, those revelations have prompted the industry to act swiftly, promoting green Bitcoin mining and energy-efficient blockchain systems.
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