Crypto mining has a very harmful effect on the ecosystem due to its extensive and powerful use of computer energy. Elon Musk’s suspension of Bitcoin as a form of payment on Tesla vehicles brought to light this very serious topic. Many people see Musk’s decision as a call to action for cryptocurrencies to change the way they go about mining.
Some people believe that the world does not need cryptocurrency and that it should be removed altogether although this is not possible. Crypto creates real-world benefits such as faster, cheaper, more reliable transactions. A goal of the Crypto Climate Accord (CCA) is for cryptocurrency and blockchain to be powered 100% by renewable energy. This is the only true way for either one to be sustainable. Industry partners are already exploring renewable energy sources while the industry as a whole has a lot of progress to make. The industry must find a standard to measure the use of renewables and make it accessible and cheap to miners for anything to truly change.
The CCA is actively working on a standard while that does not mean there is nothing that can be done in the meantime. Companies can partner with renewable energy organizations to decarbonize blockchain or even use low-carbon technologies to reduce emissions.
By design, proof-of-work systems — systems that involve mining — are inefficient. The XRP Ledger does not use a proof-of-work system but instead uses a validation and security algorithm that is over 100,000 times more energy-efficient.
Looking back, the Biden administration rejoining the Paris climate in February should have been the first sign that sustainability is a problem that is very serious across the globe. In addition, a New York Bill was proposed to prohibit crypto mining centers from operating until the state can assess their environmental impact on greenhouse gas emissions, as well as its effects on wildlife, water quality, and air quality. In the following few months, it also is expected for the UK to address concerns regarding suitability following the Prime Minister’s plans for a 68% reduction in emissions by 2030.
What’s interesting to think about is that 76% of crypto hashers claim that they are using renewable energy to power their mining processes, but only 39% of the energy consumed is renewable. The rising question is does the industry truly believe they are using renewable sources or are they just saying that to cover their backs? Either way, now that attention has been drawn to it, we can expect many more ideas to be created and laws to be proposed regarding the sustainability of crypto mining in the near future.
“Cryptocurrency Mining Must Change to Become Sustainable: Renewable Energy.” Energy Digital, energydigital.com/renewable-energy/cryptocurrency-mining-must-change-become-sustainable.
Long, Monica. “Crypto and Blockchain Must Accept They Have a Problem, Then Lead in Sustainability.” TechCrunch, TechCrunch, 16 May 2021, techcrunch.com/2021/05/16/crypto-and-blockchain-must-accept-they-have-a-problem-then-lead-in-sustainability/.