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China’s vast bitcoin mining empire risks derailing its climate targets

China’s vast bitcoin mining empire risks derailing its climate targets

China powers nearly 80% of the global cryptocurrencies trade, but the energy required could jeopardise its pledge to peak carbon emissions by 2030

China’s electricity-hungry bitcoin mines that power nearly 80% of the global trade in cryptocurrencies risk undercutting the country’s climate goals, a study in the journal Nature has said.

Bitcoin and other cryptocurrencies rely on “blockchain” technology, which is a shared database of transactions, with entries that must be confirmed and encrypted. The network is secured by individuals called “miners” who use high-powered computers to verify transactions, with bitcoins offered as a reward. Those computers consume enormous amounts of electricity.

About 40% of China’s bitcoin mines are powered with coal, while the rest use renewables, the study said. However, the coal plants are so large they could end up undermining Beijing’s pledge to peak carbon emissions before 2030 and become carbon neutral by 2060, it warned.

The Nature study on Tuesday found that unchecked, China’s bitcoin mines will generate 130.5m metric tons of carbon emissions by 2024 – close to the annual greenhouse gas emissions of Italy or oil-rich Saudi Arabia.

Chinese companies with access to cheap electricity and hardware handled 78.89% of global bitcoin blockchain operations as of April 2020, the study said. This involves minting new coins and keeping track of cryptocurrency transactions.

Co-author Wang Shouyang from the Chinese Academy of Sciences said: “The intensive bitcoin blockchain operation in China can quickly grow as a threat that could potentially undermine the emission reduction effort.”

The government should focus on upgrading the power grid to ensure a stable supply from renewable sources, Wang said. “Since energy prices in clean-energy regions of China are lower than that in coal-powered regions … miners would then have more incentives to move to regions with clean energy.”

Full story by Agence France-Presse at The Guardian


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Bill Gates Sounds Alarm On Bitcoin’s Energy Consumption–Here’s Why Crypto Is Bad For Climate Change

Bill Gates Sounds Alarm On Bitcoin’s Energy Consumption–Here’s Why Crypto Is Bad For Climate Change

As bitcoin pushes toward new highs, billionaire philanthropist Bill Gates is sounding an alarm on the cryptocurrency’s strikingly high carbon footprint

“Bitcoin uses more electricity per transaction than any other method known to mankind,” Gates told the New York Times in a recent interview, calling himself a “bitcoin skeptic,” and adding that “it’s not a great climate thing.”

To Gates’ point, Alex de Vries, a data scientist at the Dutch Central Bank, estimates that each bitcoin transaction requires an average 300 kg of carbon dioxide (CO2)–equivalent to the carbon footprint produced by roughly 750,000 Visa swipes.

That’s because nearly all cryptocurrencies, bitcoin included, document every single transaction on what’s called a public ledger, which helps ensure transactions are transparent and safe from tampering, but continuously requires additional storage space, or “blocks.” 

Blocks are created by miners, who are awarded bitcoin for their work, running code around the clock on special hardware called rigs–a process that consumes the same amount of energy annually (around 78.5 terawatt-hours) as nations like Chile, Austria and Finland.

Compounding the problem, mining networks are largely based in China, which sources much of its power from fossil fuels like coal, and as the cryptocurrency becomes more popular, its energy consumption has soared by a factor of 10 since just 2017.

Full story by Jonathan Ponciano at Forbes


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