Bitcoin’s Environmental Damage Is On Par With Beef, Natural Gas And Oil, Study Suggests

Breaking Business Bitcoin’s Environmental Damage Is On Par With Beef, Natural Gas And Oil, Study Suggests Robert Hart Forbes Staff I cover breaking news. Following New! Follow this author to stay notified about their latest stories. Got it! Sep 29, 2022, 11:00am EDT | Share to Facebook Share to Twitter Share to Linkedin Topline The environmental cost of producing bitcoin places the digital asset alongside some of the world’s most environmentally unfriendly industries, according to a new study published in Scientific Reports on Thursday, amid increasing scrutiny over the sector’s environmental footprint and debate over the sustainable future of cryptocurrencies.

Bitcoin’s environmental impact is similar to beef production, researchers said. DPA/AFP via Getty Images Key Facts The climate-related damages of each bitcoin generated—the asset is “mined” using an energy intensive computer process—in 2021 was more than $11,300, according to the researchers’ estimates, which were based on the economic costs of carbon dioxide emissions. Between 2016 and 2021, the average climate damages of each bitcoin mined stood at 35% of its market value, the researchers estimated, rising to nearly 60% between 2020 and 2021.

The researchers said the numbers place bitcoin, which is often described as a “digital gold,” much closer to environmentally unfriendly industries like beef production (33%), producing gasoline from crude oil (41%) and using natural gas to generate electricity (46%). From a climate damages perspective, the researchers said bitcoin is more of a “digital crude” than gold, which has climate costs of just 4% its value. In total, the global climate damages of bitcoin between 2016 and 2021 are estimated at $12 billion, the researchers said, and the carbon emissions have increased 126 fold over that time.

Key Background The environmental costs of cryptocurrencies, of which bitcoin is by far the largest, has become a key point in plotting the sector’s future. In 2021, the researchers estimated bitcoin mining used more energy than countries like Austria or Portugal. Sustainability has become a target for regulators around the world and China, which previously dominated the sector, sent miners scrambling in 2021 when it cracked down on the industry, at least partly for environmental reasons.

There are more efficient alternatives available to create and use cryptocurrencies out there. Ethereum, the blockchain underpinning vast swathes of the crypto ecosystem and ether, the second largest cryptocurrency, recently switched to this more sustainable system, a massive undertaking dubbed the “ Merge . ” It’s possible the bitcoin ecosystem could undergo a similar shift in the future and others are trying to make the industry cleaner by using greener energy to mine.

Further Reading Ethereum ‘Merge’: Here’s What To Know About The Hotly-Anticipated Upgrade Turning The Crypto Player Green (Forbes) ‘Green Bitcoin Mining’: The Big Profits In Clean Crypto (Forbes) Follow me on Twitter or LinkedIn . Send me a secure tip . Robert Hart Editorial Standards Print Reprints & Permissions.