Hardware power consumption and IP addresses were analyzed to calculate the carbon footprint of the cryptocurrency. The use of Bitcoin creates a carbon footprint of 22 megatons annually.
FREMONT, CA: Even though Bitcoin is a kind of virtual currency, the energy consumed by the functions and operations associated with it is real—so real that its value is comparable in a substantial manner. The rise in Bitcoin transactions is reported to have quadrupled in the last year alone. This unusual phenomenon has created doubt whether Bitcoin is safe for the environment or imposing an added burden on climate change. Many studies have tried to explain and quantify the CO2 emissions, which may have been caused by the mining of Bitcoin.
The Bitcoin mining or transfer to be carried out needs a validation, which is acquired by solving a mathematical puzzle on an arbitrary computer in the global Bitcoin network that provides open access to all. When users join and solve the required puzzles, a reward in the form of a bitcoin is generated. The capacity of computing necessary for this process is high and has increased in a paradoxical scale.
Mining among multiple parameters to quantify the power consumption
A team of management sciences and informatics researchers has orchestrated the most detailed calculation related to the carbon footprint of the Bitcoin system until today. Special systems were utilized, and three manufacturers who control the ASIC miner market planned IPOs were identified. The mandatory IPO fillings were selected to calculate the market shares of the respective companies. The challenge involved finding out if the miner was solitary or if there were a group of miners representing a farm, which was set up by a professional. It was noticed that extra cooling was necessary to maintain the temperature of the data center, in turn, consuming extra energy.
The researchers announced that the annual electricity consumption for Bitcoin Mining was accounted as 46 TWh. To calculate the CO2 emissions, the team went further to the IP addresses of miner pools, among which two of the biggest were identified, and data was captured. Based on that data, the team was able to confirm the statistics that depict the computing power consumed. It was quantified as 15 percent of the Bitcoin network is in North America, and the rest of 85 percent is spread out among European and Asian countries. Finally, the team concluded that study by identifying the Bitcoin network has a carbon footprint of 22 to 22.9 megatons per year.