Cryptocurrencies have gained increased mainstream attention in the past decade. These currencies and the technologies behind them can be complex but offer significant promise, especially in finance and trading.
Creating a crypto coin can be a simple process. As of August 2023, there were 9,321 active cryptocurrencies in existence, according to Statista.
However, many individuals and organizations have raised concerns about the environmental impacts of crypto mining and trading.
With climate change and environmental damage being a looming reality, finding eco-friendly ways to participate in cryptocurrency should be a priority.
Image by Zoltan Tasi on Unsplash
Environmental Concerns Surrounding Cryptocurrency
Cryptocurrency’s popularity comes from its potential to revolutionize our day-to-day transactions, from buying items for an online game to purchasing or selling a new home.
However, despite the appeal of cryptocurrencies and blockchain technologies within the tech and finance spheres, these technologies have significant issues.
Environmentalists, climate advocates, and other concerned parties have raised alarms about the environmental effects of cryptocurrencies, particularly during the mining and trading processes. Here are some of the most prominent environmental impacts surrounding crypto:
Energy consumption
Cryptocurrency mining and verifying processes require a significant amount of computational power. This high consumption is particularly prominent for proof of work (PoW) based coins like Bitcoin.
Mining for these coins often requires devices to solve complicated mathematical problems to validate crypto transactions and add new blocks to the blockchain. This process demands a substantial amount of energy, often from fossil fuels.
The energy consumption of some cryptocurrency networks is comparable to that of small countries. Bitcoin mining, in particular, has been criticized for its substantial energy requirements.
From 2020 to 2021, the Bitcoin mining network consumed 173.42 Terawatt hours of electricity worldwide. This energy consumption level would have ranked Bitcoin 27th in the world if it were a country.
Carbon emissions
Many crypto-mining operations rely on existing power grids to support their operations, with most running on fossil fuels. Given the large amount…
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