Risk assessment<\/strong><\/h2>\nIt is natural that as cryptocurrencies on the Proof-of-Work (PoW) consensus algorithm grew in popularity, the number of miners increased. They, in turn, continued to scale up compute power, demanding enormous amounts of electricity.<\/p>\n
Bitcoin mining has long left the era of \u201chome enthusiasts,\u201d and is now dominated by multibillion-dollar corporations that build entire manufacturing facilities. Such a transition could not fail to have environmental implications.<\/p>\n
\n\u201cMining PoW cryptocurrencies, such as Bitcoin, still poses an ecological threat. Statistics show that the electricity consumption of mining installations continues to rise. Today, in annual terms Bitcoin consumes more electricity than many countries, such as Ukraine and Sweden,\u201d said Roman Nekrasov, co-founder of ENCRY Foundation.<\/p>\n<\/blockquote>\n
Meanwhile, the Bitcoin network\u2019s efficiency \u0443\u0441\u0442\u0443\u043f\u0430\u0435\u0442<\/a> to the metrics of payment systems like Visa. Their energy consumption is significantly lower, and thus ecological harm is lower, Nekrasov added.<\/p>\n![\"Crypto](\"https:\/\/lh7-eu.googleusercontent.com\/FRPaXPQ_w3dDuLClrGB5kJaAveKY8gtycvENjArScppdOqCEwGZJtIgdV0s0EtAofuZjL0BtkJ8bkTAIAfNCsCgqQYvw5Z7ziziRGKsagHX4VxBc5lYEF3v8WgM5tS0AIV_srzwfFKxG_mWO20o97rg\")
Energy consumption for Bitcoin transactions and Visa. Data: Statista.<\/figcaption><\/figure>\nThe biggest problem of PoW algorithms is not the enormous energy consumption, but the use of fossil fuels by companies, which leaves a carbon footprint.<\/p>\n
According to Digiconomist’s study<\/a>, the annual CO2 emissions from Bitcoin mining reach 76.79 million tonnes.<\/p>\nGreenpeace regards these figures as sufficient grounds for calling for a complete code shift of the protocol for the first cryptocurrency. Yet not all participants in the industry share such a radical stance, and some do not see a problem at all.<\/p>\n
\n\u201cIf we talk about PoW, the threat is absent. There is a threat from the mining of gold, oil and other fossil fuels, but the extraction of native tokens does not cause harm. There are examples of positive effects, such as flaring of associated gas and, as a consequence, a reduction in greenhouse gas emissions,\u201d said Dmitry Zuev, co-founder of Next Generation Energy Farm.<\/p>\n<\/blockquote>\n
However, with the emergence of a large number of studies, ignoring mining\u2019s harm becomes at least socially difficult. In late 2022, American lawmakers introduced<\/a> a bill requiring the Environmental Protection Agency to analyse the industry\u2019s environmental impact.<\/p>\nBecause of the growing focus on the sector, more companies have begun to adapt to new eco-standards, implementing technologies to reduce the negative impact of cryptocurrency mining.<\/p>\n
Green methods<\/strong><\/h2>\nMining data centres have roughly the same environmental impact as other large-scale manufacturing. They contribute to deforestation, noise pollution, and the poisoning of air, water and soil.<\/p>\n
Emissions arising from digital asset mining are divided into several classes:<\/p>\n
\n- emissions category 1 \u2014 arising from the use of diesel fuel;<\/li>\n
- emissions category 2 \u2014 arising from electricity generation;<\/li>\n
- emissions category 3 \u2014 arising in the supply chain.<\/li>\n<\/ul>\n
Evgeny Kitkin, CEO of mining pool emcd, says some crypto companies have recognised the importance of the problem and strive to reduce their carbon footprint. Yet he noted the initiative is in its early stages, so many firms are only beginning to retool to meet current environmental standards.<\/p>\n
Among the most common methods of reducing CO2 emissions, Kitkin cited the use of \u2018green\u2019 energy sources, that is, renewable energy. They include time-tested technologies such as solar, wind or hydro, as well as experimental \u2014 geothermal energy and ocean thermal energy extraction.<\/p>\n
Thus, the small Himalayan kingdom of Bhutan with a population under 800,000 mines Bitcoin with the help of hydropower since the asset\u2019s price was $5,000.<\/p>\n
According to the head of the mining pool, some firms resort to re-purposing associated gas used for mining, which previously \u201cjust burned and noticeably spoiled the environment.\u201d Kitkin cited a joint Gazprom-Bitriver project to convert associated gas into electricity.<\/p>\n
The third possible way to reduce harm, the emcd representative said, is the drafting of \u201ccarbon reports.\u201d Typically, the document contains a CO2 emissions estimate for the company, after which it receives a \u201csustainability certificate.\u201d<\/p>\n
One such index \u2014 Green Proofs for Bitcoin \u2014 was developed by Energy Web. The initiative is supported by major players, including Argo Blockchain, Cowa, Digital Mining Group, Hive Blockchain Technologies and Gryphon Digital Mining.<\/p>\n
\n\u201cThe main step toward greener mining is the switch to \u2018green\u2019 energy sources. According to analysts\u2019 calculations, moving in that direction helps reduce the carbon footprint by a couple of tens of percent per year. The aggregate of available data indicates that miners\u2019 solutions are working,\u201d said the co-founder of ENCRY Foundation.<\/p>\n<\/blockquote>\n
With the development of the green mining idea, its interpretation has taken many forms. For example, the American company Nodal Power attracted $13 million<\/a> to develop \u201cwaste mining\u201d: the firm plans to recycle methane emitted at landfills into renewable energy.<\/p>\nStronghold Digital Mining requested<\/a> from the US Environmental Protection Agency permission for mining based on heat generated by burning tires. The company had planned to produce about 15% of its capacity this way but faced criticism from eco-activists.<\/p>\nIn August 2023, American Genesis Digital Assets rolled out three new facilities<\/a> in eastern South Carolina for renewable-energy Bitcoin mining. At the end of the same month the firm launched<\/a> a \u201cgreen\u201d data center in Sweden.<\/p>\nThe development of eco-mining and its real benefits<\/strong><\/h2>\nAccording to Bitcoin analyst Jamie Coutts, in September the share of \u201cgreen\u201d mining exceeded 50%.<\/p>\n
\nSustainable Energy Sources Rise >50%
?Falling emissions plus a dramatically rising hash rate can only mean one thing; Bitcoin mining is consuming more sustainable energy in its mix. pic.twitter.com\/AGXrKWDWuI<\/a><\/p>\n\u2014 Jamie Coutts CMT (@Jamie1Coutts) September 14, 2023<\/a><\/p><\/blockquote>\n
\u201cMining PoW cryptocurrencies, such as Bitcoin, still poses an ecological threat. Statistics show that the electricity consumption of mining installations continues to rise. Today, in annual terms Bitcoin consumes more electricity than many countries, such as Ukraine and Sweden,\u201d said Roman Nekrasov, co-founder of ENCRY Foundation.<\/p>\n<\/blockquote>\n
Meanwhile, the Bitcoin network\u2019s efficiency \u0443\u0441\u0442\u0443\u043f\u0430\u0435\u0442<\/a> to the metrics of payment systems like Visa. Their energy consumption is significantly lower, and thus ecological harm is lower, Nekrasov added.<\/p>\n The biggest problem of PoW algorithms is not the enormous energy consumption, but the use of fossil fuels by companies, which leaves a carbon footprint.<\/p>\n According to Digiconomist’s study<\/a>, the annual CO2 emissions from Bitcoin mining reach 76.79 million tonnes.<\/p>\n Greenpeace regards these figures as sufficient grounds for calling for a complete code shift of the protocol for the first cryptocurrency. Yet not all participants in the industry share such a radical stance, and some do not see a problem at all.<\/p>\n \u201cIf we talk about PoW, the threat is absent. There is a threat from the mining of gold, oil and other fossil fuels, but the extraction of native tokens does not cause harm. There are examples of positive effects, such as flaring of associated gas and, as a consequence, a reduction in greenhouse gas emissions,\u201d said Dmitry Zuev, co-founder of Next Generation Energy Farm.<\/p>\n<\/blockquote>\n However, with the emergence of a large number of studies, ignoring mining\u2019s harm becomes at least socially difficult. In late 2022, American lawmakers introduced<\/a> a bill requiring the Environmental Protection Agency to analyse the industry\u2019s environmental impact.<\/p>\n Because of the growing focus on the sector, more companies have begun to adapt to new eco-standards, implementing technologies to reduce the negative impact of cryptocurrency mining.<\/p>\n Mining data centres have roughly the same environmental impact as other large-scale manufacturing. They contribute to deforestation, noise pollution, and the poisoning of air, water and soil.<\/p>\n Emissions arising from digital asset mining are divided into several classes:<\/p>\n Evgeny Kitkin, CEO of mining pool emcd, says some crypto companies have recognised the importance of the problem and strive to reduce their carbon footprint. Yet he noted the initiative is in its early stages, so many firms are only beginning to retool to meet current environmental standards.<\/p>\n Among the most common methods of reducing CO2 emissions, Kitkin cited the use of \u2018green\u2019 energy sources, that is, renewable energy. They include time-tested technologies such as solar, wind or hydro, as well as experimental \u2014 geothermal energy and ocean thermal energy extraction.<\/p>\n Thus, the small Himalayan kingdom of Bhutan with a population under 800,000 mines Bitcoin with the help of hydropower since the asset\u2019s price was $5,000.<\/p>\n According to the head of the mining pool, some firms resort to re-purposing associated gas used for mining, which previously \u201cjust burned and noticeably spoiled the environment.\u201d Kitkin cited a joint Gazprom-Bitriver project to convert associated gas into electricity.<\/p>\n The third possible way to reduce harm, the emcd representative said, is the drafting of \u201ccarbon reports.\u201d Typically, the document contains a CO2 emissions estimate for the company, after which it receives a \u201csustainability certificate.\u201d<\/p>\n One such index \u2014 Green Proofs for Bitcoin \u2014 was developed by Energy Web. The initiative is supported by major players, including Argo Blockchain, Cowa, Digital Mining Group, Hive Blockchain Technologies and Gryphon Digital Mining.<\/p>\n \u201cThe main step toward greener mining is the switch to \u2018green\u2019 energy sources. According to analysts\u2019 calculations, moving in that direction helps reduce the carbon footprint by a couple of tens of percent per year. The aggregate of available data indicates that miners\u2019 solutions are working,\u201d said the co-founder of ENCRY Foundation.<\/p>\n<\/blockquote>\n With the development of the green mining idea, its interpretation has taken many forms. For example, the American company Nodal Power attracted $13 million<\/a> to develop \u201cwaste mining\u201d: the firm plans to recycle methane emitted at landfills into renewable energy.<\/p>\n Stronghold Digital Mining requested<\/a> from the US Environmental Protection Agency permission for mining based on heat generated by burning tires. The company had planned to produce about 15% of its capacity this way but faced criticism from eco-activists.<\/p>\n In August 2023, American Genesis Digital Assets rolled out three new facilities<\/a> in eastern South Carolina for renewable-energy Bitcoin mining. At the end of the same month the firm launched<\/a> a \u201cgreen\u201d data center in Sweden.<\/p>\n According to Bitcoin analyst Jamie Coutts, in September the share of \u201cgreen\u201d mining exceeded 50%.<\/p>\n Sustainable Energy Sources Rise >50% \u2014 Jamie Coutts CMT (@Jamie1Coutts) September 14, 2023<\/a><\/p><\/blockquote>\n \n
Green methods<\/strong><\/h2>\n
\n
\n
The development of eco-mining and its real benefits<\/strong><\/h2>\n
\n
?Falling emissions plus a dramatically rising hash rate can only mean one thing; Bitcoin mining is consuming more sustainable energy in its mix. pic.twitter.com\/AGXrKWDWuI<\/a><\/p>\n