Launched in 2009 by “Satoshi Nakamoto,” whose identity remains unknown, Bitcoin was the first cryptocurrency to scale.
Since then, it has risen to prominence through high-security blockchain technology to provide an open-source alternative to institutional or government-backed currencies, the U.S. dollar.
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The digital currency continued to operate on a stronger horizon than ever. As a result, early investors and miners who followed early cryptocurrency trends and held onto their assets have reaped huge rewards many times over.
Bitcoin is finding trouble surpassing the 35k mark | Source: BTCUSD on TradingView
But here, the focus will be on why the decentralized currency has come to be under attack or been a subject of argument over environmental impact.
Issues on energy consumption have become the latest flashpoint for cryptocurrency. Many critics have donned the currency as an energy-consuming leviathan while friendly proponents debunk the accusation, hailing it instead for being less intensive in power consumption than the current global energy consumers.
Here, we take a careful study of the opposing views.
Arguments Concerning Bitcoin Mining Energy Consumption
Analysts from Cambridge University might also share the same perception with him, as the BBC has recently reported that bitcoin uses more electricity annually than the whole of a South American country -Argentina.
Regarding “mining,” the analysts claim that it is power-hungry, involving heavy computer calculations to verify transactions.
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The report by the researchers says it consumes around 121.36 terawatt-hours (TWh) a year and is unlikely to fall unless the value of the currency falls either.
Another report also suggests that Bitcoin uses more energy than American Airlines, and each $1 billion in inflows is equal to owning 1.2 million cars, says Bank of America.
Elon Musk’s Affair
The impact of its mining activities on global greenhouse gas emissions was the major gripe and cause for Musk ending his love affair with bitcoin a few months back. As a crypto heavyweight, his argument weighs heavier on the debate.
In May, two months after his company started taking payments in Bitcoin, the Tesla boss announced that the firm would no longer accept cryptocurrency due to the “rapidly increasing use of fossil fuels for bitcoin mining” concerns.
Proving Musk a significant player, the comment was quickly followed by a deep unconscious in bitcoin’s price.
However, the SpaceX central crooner’s latest tweet shows some hope for his love affair, dependent on Bitcoin improving its renewable energy use.
This is inaccurate. Tesla only sold ~10% of holdings to confirm BTC could be liquidated easily without moving market.
When there’s confirmation of reasonable (~50%) clean energy usage by miners with positive future trend, Tesla will resume allowing Bitcoin transactions.
— Elon Musk (@elonmusk) June 13, 2021
The Argument Against Mining Less Inimical
According to BMC, a voluntary global forum of Bitcoin mining companies, the global industry’s sustainable electricity mix had grown to 56% during the second quarter, based on its “first-ever voluntary survey.”
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Kraken Director Dan Held also shared a similar idea on his Twitter, claiming the digital currency mining renewable energy use sits at 56%.
Bitcoin mining uses 56% renewable energy.
Your move @elonmusk.
— Dan Held (@danheld) July 6, 2021
Research by ARK Investment Management discovered the Bitcoin ecosystem depletes less than 10% of the energy needed for the traditional banking system.
The cryptocurrency mining industry, which pooled almost $1.4 billion in February 2021 alone, is not yet unusually terrible for the environment compared to other aspects of modern life in an industrialized society.
Featured Image by Pixabay - Chart by TradingView