A study published earlier this week says that around 75% of the whole world’s bitcoin mining happens in China as there is easy access to specialized hardware-making manufacturers and cheaper electricity, and this could hamper the country’s carbon emission-reduction goals due to intensive bitcoin mining.
Bitcoin, being a decentralized currency requires computer mining, that uses electricity in large quantities, unlike the traditional currencies. The study says that this intensity led to China’s bitcoin carbon footprints as huge as one of its biggest cities.
This happens when bitcoin transactions recorded on the blockchain (a public ledger) are verified by miners who allow a transaction to happen by solving hard math puzzles through purpose-based computers. The miners will receive a bitcoin as a reward after the transaction succeeds.
This paper based on mining activities in China was published by Nature Communications and came in despite China’s eloquence that the nation is looking forward to becoming environmentally friendly. A statement from China’s President Xi Jinping last year stated that the nation targets its peak emissions of carbon by 2030 and its neutrality by 2060.
The paper’s authors wrote, “Without appropriate interventions and feasible policies, the intensive bitcoin blockchain operation in China can quickly grow as a threat that could potentially undermine the emission reduction effort taken place in the country,” in their thesis.
The study’s authors further wrote that the on-growing energy consumption and the carbon emissions from bitcoin mining have the potential to undermine the efforts globally. The bitcoin’s annual energy consumption in China could be at its peak by 2024 with 296.59 Twh, emitting 130.50 metric tons of carbon, the study further reads.
As per Cambridge University’s project – the Cambridge Bitcoin Electricity Consumption Index, Bitcoin mining all over the world needs nearly 128 terawatt-hours of energy every year. This is way more than the entire consumption of countries like Argentina and Ukraine.
The authors also quoted that the country’s energy usage for bitcoins will be more than Saudi or Italy’s total consumption. The study is published as a part of a peer-review journal. The paper “leaves a lot to be desired,” says Nic Carter, the co-founder of Coin Metrics crypto website.
Nic says he felt that the paper would cover the energy mixes of Chinese miners talking about province-based information. Instead of that, the authors just claimed considering this data, Nic’s tweet further read. The study’s authors are yet to respond to these comments.