Cryptocurrencies like Bitcoin are becoming more mainstream. These digital currencies and assets are potential alternatives to the old centralized financial systems. Millions of people currently use cryptocurrencies, a trend likely to continue growing. Therefore, many environmentalists have begun raising concerns about cryptocurrencies’ positive and negative impacts on the economy, the environment, and society. Many Bitcoin users are trading Bitcoin through Bitcoin trading platforms like Quantum AI.
Bitcoin is the Most Popular Cryptocurrency
Bitcoin is the leading cryptocurrency in terms of popularity and usage. It is also the pioneer cryptocurrency. These accolades should not make anyone think that there are no other cryptocurrencies. There are over 20,000 cryptocurrencies, and crypto experts project that the number will continue to increase.
Bitcoin has maintained the top position in the cryptocurrency market thanks to its robust blockchain technology. Blockchain is a decentralized ledger on which every Bitcoin transaction is a permanent record whenever it occurs. Blockchain technology also includes miners who create new Bitcoin by solving complex mathematical problems.
You can use Bitcoin as a digital currency to pay for services or products, as more businesses are embracing it as an acceptable payment option. You can also invest in Bitcoin as an asset. Here, you can trade Bitcoin by buying or selling it for profit.
Impact of Bitcoin on the Environment
Undoubtedly, Bitcoin is creating numerous opportunities for investors in the digital economy. Bitcoin traders can make high profits from their Bitcoin investments. Thanks to the cryptocurrency’s volatility, Bitcoin’s profit potential emerges from the idea of buying low and selling high. You acquire Bitcoin when the price is low and sell when the price rises.
The positive economic impacts of Bitcoin have often overshadowed the environmental effects. Overall, environmentalists and Bitcoin critics have raised concerns regarding the negative environmental impacts of Bitcoin mining. Specifically, the problems revolve around the high-energy consumption and the carbon footprint of mining Bitcoin.
To put it into perspective, mining Bitcoin consumes significant amounts of energy. According to some estimates, the annual energy consumption of Bitcoin exceeds that of some countries. Currently, Bitcoin mining consumes approximately 144.16 terawatt hours. That’s problematic from an environmental perspective. It also exacerbates energy scarcity and contributes to global warming and climate change.
Bitcoin miners invest a lot in energy. Most of this energy is non-renewable, and its unregulated use increases carbon and greenhouse gas emissions. These gases cause global warming by degrading the ozone layer. Global warming is now a reality for everyone to see. The increased incidents and intensities of extreme weather events such as drought, flooding, and tropical cyclones directly affect millions of people worldwide.
Sustainability of Bitcoin
The negative environmental impacts of Bitcoin make it potentially unsustainable. If we leave the current high-energy usage unchecked, it may soon become economically and environmentally unsustainable. Already, global warming is causing untold suffering globally. Analysts present an even worse future if nothing changes.
Thankfully, Bitcoin does not have to cross that line. There are opportunities to ensure it remains sustainable. One such chance is to shift from the Proof of Work model to the Proof of Stake and other more energy-efficient crypto mining models. Bitcoin still relies on the Proof of Work system, which is energy intensive. However, other cryptocurrencies like Ethereum have shifted to more sustainable models like the Proof of Stake, which consumes over 99% less power.
Parting Shot
Bitcoin can follow suit by changing from the Proof of Work. As the leading cryptocurrency, it can do this. More importantly, there is a need to sensitize Bitcoin miners on the longer-term benefits of Proof of Stake over the short-term benefits of maintaining the Proof of Work model. Otherwise, their massive investments in mining equipment and technology may become less viable in a few years because of the growing popularity of more sustainable ones.
Image by Mircea Ploscar from Pixabay
