Crypto bros have devoted entire subreddits to discrediting the economist’s reporting as propaganda linked to his job at the Dutch central bank.
Not only is he still publishing new insights on his site Digiconomist, but he’s also picking up the phone whenever journalists call.
“ suggested that a single bitcoin transaction on average consumed as much electricity as a US household in one and a half day at the time,” de Vries says.
According to de Vries’ research, the digital dosh has a carbon footprint the size of the Czech Republic, consumes as much electrical energy as Thailand and produces 32,27 kilotons of electronic waste per year, which is roughly the same amount generated by small IT equipment waste in The Netherlands.
Some suggested that people saw it as a form of digital gold, a safe haven asset to inject cash into during times of uncertainty.
Others have propounded the rise of bitcoin investment as a result of lockdown boredom, that people just bet on it as an alternative against apathy.
While interest in cryptocurrency startups had seemingly dropped after the record year of 2018, VCs returned in force in 2021.
While that may calm some market watchers buying into the notion that a cryptocurrency winter is coming, it doesn’t explain what will happen the next time bitcoin speculation will see the value of the blockchain asset grow.
Each block includes a record of all new and all historical transactions made on the bitcoin blockchain.
The miner that solves the puzzle then presents their proof-of-work, evidence for the computational efforts made, to the rest of the network.
Instead, it runs on a consensus model where each node is accepted by the majority of miners.
While most researchers agree that bitcoin uses a mammoth amount of electricity, their estimates differ when it comes to how big the impact on the environment is.
The Cambridge researchers also alert against presenter bias, suggesting researchers may only see what they want to see.
The researchers also suggest that the energy usage isn’t that massive, especially if compared to regular home appliance.
Nilsson adds that other factors make these estimates even more uncertain.
de Vries has, however, argued that the amount of renewable energy being used by the network decreased from 41.6% to 25.1% in the last year.
” these miners were physically moving their equipment around throughout the year,” de Vries says.
He argued that bitcoin miners buy energy from wind and solar energy providers when these resources are abundant, and only rely on the fossil-heavy grid for the rest of the time.
The American Clean Power Association reported in February, 2022, that Texas is also installed 7,352 megawatts of wind, solar and energy projects in 2021.
As the hash rate climbs with the popularity of bitcoin, miners must update their hardware in order to stand a chance.
They have increasingly started to big-up the idea of “lifecycle mining.” In short, the idea is that miners should hook up older hardware to renewable energy sources and keep their fresh purchases on the grid.
Clearly, clean energy is the way forward, but their sources are sometimes irregular and there’s not enough storage capacity for when these sources generate excess energy.
No matter what estimates one uses, it’s clear that bitcoin uses ginormous amounts of electricity.
“Everything we do digitally uses energy.
She suggests that while bitcoin uses a lot of electricity, so do regular fiat money systems. However, she says that “one of the benefits of means that it’s incredibly secure.” The crypto expert has a point.
“The bitcoin lockchain is seen as the safest way to store money – it has never been hacked,” Stanford says.
Investment tychoon Warren Buffet once compered bitcoin to rat poison, but his firm Berkshire Hathaway invested $1bn into a crypto-friendly neobank Nubank earlier this year.
In the past he’s compared it to smoking and scams. Frauds like BitConnect and OneCoin have made little to dissuade him of this fact, nor has the ubiquity of ransomware gangs using bitcoin to get paid.
“Now it has a major crypto trading department,” Green says.
Regulators are also increasingly suggesting that the asset class shouldn’t be banned, but that it should face tougher policing.
It’s the oldest and it was built a long, long, long time ago when there weren’t so many people around and using it.
A plethora of new digital monies have launched in the wake of bitcoin founder Satoshi Nakamoto penning the whitepaper that would set off the crypto revolution in 2008.
Others, like the world’s second biggest cryptocurrency, Ethereum, are more serious.
The NEAR Foundation’s blockchain is an example of a chain that runs entirely on a proof-of-stake validations method.
Sweatcoin, which runs on the NEAR Foundation’s blockchain, tries to encourage greener habits by minting its own SWEAT token on the numbers of steps its 63 million users take.
Then there are projects like Cowa, which claims to be a zero-carb on mining blockchain, that are trying to cut the cryptocurrency industry’s emissions.