China has been a popular location for bitcoin mining, because it has a surplus of cheap power that is needed to run the networks of computers.
“Current global energy consumption for service to run bitcoin software is around 22 terawatt hours per year. That’s the same amount of energy consumption a country the size of Ireland has,” Shirvani said.
“If you look at one single bitcoin transaction, you would actually need as much energy that you would need to power nearly 31 US households for a full day, while at the same time currently we’re trading around one million bitcoin transactions a day.
“So the amount of electricity we’re talking about is just absolutely enormous.”
If the process continues on its current path, bitcoin alone could generate enough carbon dioxide to push the planet beyond 2C of warming by 2033, Shirvani said.
“If this trend that is inevitable, going more and more towards crypto, we have to find possible solutions.”
These could include miners taking a fee from every transaction, rather than using computers to solve equations, reducing the amount of electricity required for the system.
Renewable energy sources could also be used to mine bitcoins in a greener way.
“There are different cryptocurrencies that are moving away from this heavy mining process, but… still 70 percent of global mining is happening in China in the traditional proof of work system that is running on extremely cheap, coal-provided energy sources.”
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