Bitcoin has been the premier cryptocurrency for years, with traders having invested a total of roughly $1.2 trillion in the asset to date.
In spite of the attractive returns that this crypto has produced and the shift in investment possibilities that its rise has created globally, one major criticism has consistently been leveled against it: energy consumption.
However, new evidence suggests that the coin has finally started to shed this reputation as its sustainable energy consumption exceeds 50%.
This article will examine how this impressive improvement was achieved and what it means for the future of cryptocurrency.
Bitcoin Reverses Its Climate Impact For The Better.
Growth in any asset class, be it a cryptocurrency, manufactured commodity, or service, comes at the cost of environmental resource use.
While the benefits associated with ever-rising cryptocurrency prices aren’t difficult to see, the disadvantages, such as the enormous energy consumption used by crypto mining, have been revealed through dramatic headlines in recent years.
At present, bitcoin mining, which requires the dedicated use of computer processing power, still consumes about147.3 terawatt-hours a year – as much electricity as the entire country of Malaysia.
- Since electricity consumption is generally supplied by power sources that derive energy from burning fossil fuels, environmentalists have argued that the proliferation of cryptocurrencies directly contributes to the damaging effects of climate change.
- These criticisms have not gone unheard in the cryptocurrency community, especially given the dramatic increase in global temperatures and natural disasters that are being attributed to global warming.
As a result, the crypto industry has made strong commitments to using green energy and renewables as it seeks to power the blockchain-based mining functionality that makes this innovative asset type so unique and popular.
Bitcoin Attains A 53% Sustainability Ratio.
In January 2024, a report citing industry expert Daniel Batten declared that bitcoin mining is now 53% sustainable in terms of energy sources.
This is certainly good news for the environment and should go a long way to addressing the concerns of environmental activists who have criticized it for its negative climate effects.
Recently, several studies have also indicated that the cryptocurrency industry could be the catalyst for green energy development, not only a consumer sustainable power.
This would add another function to crypto’s long list of use cases, which range from currency hedging to retail purchases and even hugely popular crypto casinos offering bitcoin blackjack. When it comes to this crypto-powered card game, in particular, bitcoin blackjack has proved itself as one of the most popular options in mainstream entertainment. Bitcoin blackjack operates on decentralized, blockchain-based platforms, where transactions and outcomes of the game are kept on the blockchain.
Powering the card game involves computational resources, as it is a data-intensive endeavor. Firstly, the Bitcoin blackjack platform must handle the secure transfer and storage of Bitcoin, requiring robust encryption and wallet management systems. Additionally, the card game’s algorithms, which determine card shuffling and dealing, are executed on decentralized servers. This setup ensures that the game runs smoothly and is resistant to tampering.
Ultimately, the rise of Bitcoin blackjack and similar applications has intensified the need for sustainable energy solutions within the entertainment sector. Luckily, according to KPMG, bitcoin has the potential to fast-track green energy projects in many countries. The share amount of capital invested in crypto mining dwarfs that of many industries, giving it a strong incentive to secure a reliable source of energy.
Crypto assets can be leveraged to invest in green power production through solar, wind, and other sustainable sources – with major investments from the crypto industry backing the rapid expansion of the power grid in countries around the world, especially in developing nations.
If these reports are to be believed, and if the industry acts in accordance with them to become a major player in the green energy industry sector, we could see several beneficial knock-on effects.
- Crypto-financed green energy projects would not only produce sufficient power to enable Blockchain and crypto mining activities.
- The surplus energy generation from these projects could be fed back into local power grids, especially in poor countries where the cost of energy generation cannot be borne by retail electricity, prices, and overburdening poor families.
Increased investment in sustainable energy via green technology by the crypto industry would give it a strong stake in the future success of these projects on a global scale.
Could Bitcoin Mining Renew Aging Electricity Grids?
Since the energy-generating capacity that they provide would become absolutely essential to the functioning of the cryptocurrency market, ongoing financing, and project success would be extremely likely.
This level of vested interest could result in far more efficiently maintained and competitively priced electricity networks than are currently in place in many nations – including some developed markets.
- The United States, in particular, with its aging electricity grid, is due for a major reinvestment in generating capacity.
- Public-private partnerships between the government and the crypto industry to generate the electricity needed for bitcoin mining could help to rejuvenate American industry as it provides cheap and clean electricity for both crypto and light industrial and residential uses.
- From a reputational standpoint, the crypto industry could generate substantial goodwill both with the public and its critics in the environmental lobby by showing a proactive interest in the financing of green energy alternatives.
This could go a long way to increasing public interest in crypto investing even more and allaying the fears of lawmakers in some countries who have threatened to over-regulate the industry.
Conclusion
Bitcoin mining is now 53% reliant on renewable energy, mitigating concerns from the public as well as environmentalists regarding the crypto industry’s contribution to global climate change.
Going a step further to invest in green energy – and not only consume it – could bring several benefits to the crypto industry. More efficient power grids in many nations around the world and a reputational advantage as the crypto sector is seen as an investor in the public good are just two of the advantages of crypto-backed sustainable energy.
