Since mid-2020, when we see a renewed increase in the popularity of cryptocurrencies as a source of easy profit, avoiding transaction costs and escaping from fiat money inflation, the energy costs associated with "mining" Bitcoin were revealed in the media. Energy experts began to carefully assess the functioning of the cryptocurrency market in terms of electricity consumption in relation to the amount of electricity consumed by the economy. It turned out that bitcoin mining costs annually at least as much electricity as a medium-sized country like Finland consumes. If Bitcoin were a country, it would rank in the top 30 worldwide for energy use. I enclose the research results in charts and links to the publication. Meanwhile, in 2021 we are witnessing the emergence of an energy crisis all over the world and an incredible increase in the prices of natural gas and crude oil as a result of climate disturbances, disruptions in the supply chain and broken cooperative ties between international companies. Therefore, what are the prospects for such a phenomenon as cryptocurrencies or other energy-intensive technologies, the use of which is completely against the policy of reducing greenhouse gases and switching to renewable energy on a global scale? Is the true thesis that the growth rate of the BTC market price to USD is comparable to the growth rate of electricity consumption by cryptocurrency miners?
https://www.ft.com/content/1aecb2db-8f61-427c-a413-3b929291c8ac
https://www.nytimes.com/interactive/2021/09/03/climate/bitcoin-carbon-footprint-electricity.html
Dear Dariusz Tomasz Grala,
You have pointed out a very important problem with the use of the cryptocurrency Bitcoins!
Another question still arises - namely: How do I use the cryptocurrency when the Internet is not available?
The Internet has a tree-like logical structure. Thus, for example, the availability of the Internet in a country can be maliciously or deliberately blocked. How can the cryptocurrency then be used?
See my answer below
https://www.researchgate.net/post/Will_Bitcoins_vanished_in_one_day_when_we_woke_up
and
https://www.theguardian.com/technology/2011/jan/28/egypt-cuts-off-internet-access
Best regards
Anatol Badach
Dear J. Rafiee, thank you for your contribution and such a comprehensive answer. I am impressed by your reading and insightful knowledge of the subject of innovation. I share your opinions in almost 100%. I believe that blockchain technology has great potential for use in the economy. Today, on the other hand, cryptocurrencies are used for speculation and as "digital gold" (a form of preserving wealth against inflation and for disguising criminal activity, money laundering, etc.). For me and for many analysts, crypto is used completely contrary to its original purpose. I hope that this speculative boom will be quickly interrupted and that the crypto price will be "real" adequate to the share of these funds in commodity transactions, and not as a substitute for precious metals. In conclusion, according to your recommendation, the entire crypto market must be globally regulated, under the control of a supranational institution and, most importantly, secured against the use of cryptocurrencies by terrorists, mafia and gangsters. Today we know, for example, that Islamic terrorists in Europe were financed through the crypto market and could have large funds outside the banking system and invisibly buy weapons and other military supplies. Best regards
In this article we look at these issues, I hope you find it of interest.
Article Cryptocurrency Mining from an Economic and Environmental Per...
Thank you Professor Miguel Ángel Echarte Fernández for the link to the article. I have read the text and made a recommendation. I am very glad that your team in Spain has done such difficult research on the problems of "mining" cryptocurrencies . Your article shows directly on the basis of statistical analysis that, at least until mid-2021, the most bitcoin was produced in countries operating their energy from the combustion of fossil fuels, in particular coal and oil. Shocking results pointing to the unequivocally negative impact of the extraction of the so-called cryptocurrencies on the environment. I, on the other hand, often received comments from honest entrepreneurs from my country, Poland, where it is being implemented intensively and promoting the use of solar panels and windmills that are expensive to use to obtain electricity from the sun and wind. Entrepreneurs paying very high electricity bills in their factories and workshops are forced to increase the prices of bread and sweets, etc. for products that use a lot of electricity in the process this year by as much as 20-30% up this year. At the same time, they will not be able to understand the liberal policy of Western countries towards cryptocurrency miners, who use huge amounts of electricity in the process of extracting BTC without giving the public anything in return but the electricity fee. The created cryptocurrency does not create added value .. it does not create a product for consumption, unfortunately crypto serves today, thanks to the consent of monetary authorities and governments, mainly as a substitute for precious metals for the accumulation of financial wealth as "digital gold" resistant to money inflation. More and more people see the problem that normal companies producing goods and services for the public are imposed increasingly higher requirements in terms of the use of electricity, forcing the use of "green" energy, and for cryptocurrency producers who "burn" terawatt of energy to obtain digital record, the authorities do not impose any standards, for example a high tax on 24-hour electricity consumption. It is a comforting fact that in People's China, in the face of an electricity deficit, the authorities have finally banned the mining of cryptocurrencies that consume energy in this country for about 15 million people. Best regards
Since cryptocurrency miners are use a lot of electricity and electricity specially produced by fossil sources, of course it's has a lot of impact on global environment especially green ones. In process of producing electricity there is a side product and that is greenhouse gases that naturally affect global environment and of course people's lives and cause a lot of illnesses.
Thank you Dear Yahya Ahmadi for participating in the discussion and noticing the phenomenon of environmental pollution as a result of the production and trading of cryptocurrencies. All the best
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