The world’s greenhouse gas problem is caused by huge manufacturing plants that belch pollution into the air, too many gasoline-powered cars and agricultural activity, among other things. If regulations can throttle these activities, the rise in carbon dioxide in the atmosphere might stabilize, or even drop.
There is a new culprit in the greenhouse gas wars. Bitcoin and other blockchain activities use enough energy that they are a threat to lowering energy consumption.
According to a research paper titled “Decarbonizing Bitcoin: Law and policy choices for reducing the energy consumption of Blockchain technologies and digital currencies”:
The vast transactional, trust and security advantages of Bitcoin are dwarfed by the intentionally resource-intensive design in its transaction verification process which now threatens the climate we depend upon for survival. Indeed Bitcoin mining and transactions are an application of Blockchain technology employing an inefficient use of scarce energy resources for a financial activity at a point in human development where world governments are scrambling to reduce energy consumption through their Paris Agreement climate change commitments and beyond to mitigate future climate change implications.
Reference to the Paris Agreement, a critical alliance of countries around the world to cut air pollution problems, is a trump card to make the bitcoin problem seem as serious as possible.
Environmentalists can hope the value of bitcoin will collapse, which would make its contribution irrelevant. However, blockchain has become an important technology utilized across several industries, and it is growing. Its effects are not going away.
The effects of bitcoin also will not go away anytime soon. Bankers and economists have said the cryptocurrency is unstable in price and useless in most real-world transactions, which currently require some form of traditional currency. However, the primary use of bitcoin today is speculation, which drives its price up and down rapidly. In essence, it is a good way to make, or lose, money. Speculators don’t care about the environment.