Cryptocurrencies made its way towards the consciousness of tech-savvy individuals by being able to eliminate third parties in terms of confirming transactions. However, many are claiming that there are drawbacks to the process which transactions are being confirmed. Miners make use of computers with high computational power that require a massive amount of energy. In fact, there is a study saying that Bitcoin mining can power an entire country.
Is It Really That Bad?
Should there be a reason to be alarmed by the fact that cryptocurrency mining consumes a good amount of energy? If you are going to ask the professional assessment of Dr. Katrina Kelly-Pitou who works as a research associate in electrical and computer engineering at the University of Pittsburgh, the amount of electricity consumed in Bitcoin mining isn’t alarming at all.
Kelly-Pitou criticizes the claim that Bitcoin mining is a design flaw. Kelly-Pitou mentioned that the environmental risk that critics claim is a gross oversimplification that is inaccurate. She explained that the “Bitcoin energy crisis” is nothing but a red herring saying that “I am a researcher who studies clean energy technology, specifically the transition toward decarbonized energy systems…New technologies – such as data centers, computers and before them trains, planes, and automobiles – are often energy-intensive. Over time, all of these have become more efficient, a natural progression of any technology: Saving energy equates to saving costs”.
According to her, the use of renewable energy can allow additional power consumption regardless of the purpose without any negative environmental impact. Instead of saying that Bitcoin mining consumes a good amount of electricity, she believes that the debate should be centered towards how the electricity is generated.
She stated that “By talking specifically about … the consumption of energy alone..many fail to understand one of the most basic benefits of renewable energy systems. Electricity production can increase while still maintaining a minimal impact on the environment….Not all types of energy generation are equal in their impact on the environment, nor does the world uniformly rely on the same types of generation across states and markets”.
She pointed out that Bitcoin mining’s annual electrical usage is at 30 terrawatts while the entire global banking industry is estimated at around 100 terrawatts. And also, she mentioned that even if the crypto industry grows, this would mean that its share on global energy consumption is only just at 2 percent.
Race Towards Cheaper Electricity
There is no denying that many crypto miners face different challenges. They need to find a place where they can operate and make the most profits. Canada and China are among places that have attracted cryptocurrency mining activities. However, places such as Quebec made a special rate for crypto mining businesses.
But of course, there are those places such as Iceland that have also become a popular destination for many crypto mining businesses. It has geothermal energy, and the country functions almost 100% on renewable energy.
Kelly-Pitou mentioned that “like many other aspects of the energy industry, bitcoin is not necessarily a ‘bad guy’. It’s simply a new, and vaguely understood industry. The discussion about energy consumption and bitcoin, is I believe, unfair without discussing the energy intensity of new technologies overall, specifically in data centers”.