Cryptocurrencies and the environment
The acute irruption of the cryptocurrencies It has not only shaken the political, economic or technological world, but it has also sparked debate in other branches of society.
One of them is how cryptocurrencies affect the environment. The great concern of the 21st century … ¿What energy expenditure generated by this cryptocurrency? How do they affect the planet? How do the digital currencies in society? Do they have a positive or negative effect?
Just to start and so that you have a comparative idea of its scope …
electricity spending on bitcoin mining exceeds consumption in all of Denmark
But there is much more! And today we have to understand how the growth of cryptocurrencies affects us in many areas.
The arrival of cryptocurrencies to energy consumption
With Bitcoin at the helm, since 2009, it has taken the world by storm. Something that at first seemed a phenomenon of "niche”Within the vast Internet, it has managed to get many countries to change their legislation and many other economic instruments so that this currency does not affect their traditional economy.
Such has been the debate; which has not only generated intense discussions within the political and economic world, but has also reached spheres such as philosophy and, above all, the environment.
Produce cryptocurrencies have a huge energy expenditure and, although we will analyze it in depth later, in March 2022, the world energy consumption of the Bitcoin network It was estimated at 149 terawatt-hours (TWh) from bitcoin alone! If we compare it, we would have to:
Users of cryptocurrencies like the new Ethereum, just to cite one example of enormous growth, seem to be interested in more than just financial speculation, something that does happen in the world of stocks.
For those who they mine cryptocurrencies since before they were a boom, the fact consume so much energy worldwide surpasses any speculation.
But… How is the mining of digital currencies affecting the planet? How do cryptocurrencies affect the environment? Let's go with a more extensive explanation …
How does bitcoin affect the environment?
The only way to produce bitcoinsSince there is no central bank that issues the paper banknote, it is through the miners and any user can be. The cryptocurrency miners are in charge of producing the hash code, which is obtained using software created especially to be able to circumvent cryptographic problems.
Globally, we can quickly see who is dedicated to producing the most digital currencies on the map below …
We can quickly see that China is the largest producer of digital currencies, after the United States followed by Russia, etc. This map and other data of interest on the creation of hashes are very well exposed in an analysis carried out from the University of Cambridge.
The energy dependence to produce coins directly affects the environment and the traditional electrical ecosystem; The high complexity of producing them results in the need for a large amount of electricity with a lot of associated problems.
The currency is digital, but actually the pollution is very real. The carbon footprint of bitcoin mining per year it exceeds 17,000 kilotonnes of carbon dioxide …How much energy does it take to create bitcoins?
First an approach to 2022, and then a map that reaches 2022. The change in upward trend is simply brutal!
It is estimated that currently the electricity expenditure on bitcoin mining it exceeds that of countries such as Denmark, Bulgaria and Belarus, and accounts for more than 25% of energy consumption in the Netherlands, 15% in Australia or 10% in the United Kingdom.
If we look at the type of energy that is consumed to create coins, we have:
| Power source | Pacific Asia (%) | Europe (%) | Latin America and the caribbean (%) | North America (%) |
| Hydroelectric | 0,65 | 0,6 | 0,67 | 0,61 |
| Natural gas | 0,38 | 0,33 | 0,17 | 0,44 |
| Coal | 0,65 | 0,02 | 0 | 0,28 |
| Wind | 0,23 | 0,07 | 0 | 0,22 |
| Petroleum | 0,12 | 0,07 | 0,33 | 0,22 |
| Nuclear | 0,12 | 0,07 | 0 | 0,22 |
| Solar | 0,12 | 0,13 | 0,17 | 0,17 |
| Geothermal | 0,08 | 0 | 0 | 0,06 |
We can verify that although renewables are on the rise, still the Coin mining energy consumption is seriously damaging the environment.
The following map shows which countries in Europe consume more or less electricity compared to world mining:
For example, according to a report by the International Energy Agency (IEA), Bitcoin and the rest of cryptocurrencies are positioned as one of the businesses that consume the most electricity worldwide. Naps cryptocurrencies were a country, they would occupy the dangerous position number 41 in the ranking of nations that consume more electricity annually according to Digiconomist. It would be classified as shown below:
Cryptocurrencies is one of the businesses that consumes the most electricity worldwide
In addition, other climate studies indicate that After the cryptocurrency fever broke out, electricity consumption has increased by about 30% in some cities around the world due to the amount of current that computers need to mine cryptocurrencies.
Apart from the comparison and graph above, it is also possible to compare the Bitcoin power consumption with some of the largest energy consuming countries in the world. The result is shown below.
We can also see the comparison of Bitcoin's energy consumption with other payment systems (The example is with VISA):
Now, not everything is negative in this regard: Cryptocurrencies have the advantage of not needing to be printed and the same happens with inkTherefore, no tree suffers from them and no energy is wasted in all the machines that participate in the complex made up of a national banknote.
In summary, it can be compared to that of magazines and newspapers: their presence in the web world increases electricity consumption, but leaves the trees alone, so it is necessary to do in-depth studies on the pros and advantages of each case, and start thinking about applying circular praise measures from a technology perspective.
Learning more about cryptocurrencies and their history
As we noted earlier, the first coin, also known as cryptocurrency, It was Bitcoin, launched into the world back in 2009. As can be traced, its created is an anonymous person, although its name has been known: Satoshi Nakamoto.
The idea of this new virtual currency is that it works as a form of alternative payment, whose main characteristics is to be a safe currency without intermediaries and, furthermore, without having to be linked under any circumstances to the central banks of the countries.
It should be remembered that these national bodies are not capable of devaluing the currency; Cryptocurrencies, by not having that relationship, maintain an even greater autonomy. After the first steps, in recent times other virtual currencies have come to light such as Dash, Ripple Y Litecoin.
What is the Blockchain?
What is really new about this new payment method, is undoubtedly its innovative security system: Blockchain. Surely you have heard about this technology several times without fully understanding what it is about, but it is not as difficult as it seems.
The Blockchain system It is made up of a series of "blocks" that are nothing more than the transactions that take place within that system. Each one of them is transmitted to a network of the type peer-to-peer made up of thousands of computers in an encrypted way. Each of these blocks has, in turn, a code called hash so that it can be validated.
This elaborate system has the result that all users of said cryptocurrency manage to be informed of each transaction that occurs. This results in greater security that prevents theft and fraud within the system.
What cryptocurrencies are more profitable?
At present, Most profitable cryptocurrencies are Bitcoin and Ethereum, and between the two there are a sea of differences, multiplying the value almost by 5. However, both generate a negative impact on the environment at the moment, so the best option may be to bet on a smaller one but that will give you good returns: Ripple.
This young cryptocurrency calls on all those entrepreneurs in the world to join its system, without the need for machines working continuously. Also, predicting the future of Ripple is much easier than with other currencies, so if you are a beginner in the field, this is the best option.
You have to think that the world of Crypto coins It is a business and as such, it has its risks and benefits, but as a wise man said… “For any entrepreneur: if you want to do it, do it now. If you don't, you will regret it »
Always remember that each step we take on the planet leaves its mark, even if it is not visible to us at the moment. Making money is never wrong, the problem is which method we are going to use.
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