Environmental effects of bitcoin

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Environmental effects of bitcoin comprise increased carbon emissions and electronic waste accumulation, causing the cryptocurrency to have a negative impact on Earth's climate and the natural environment through pollution.[1] Bitcoins are produced through a time- and energy-consuming process called mining, which uses electricity partially generated by gas and coal-fired power plants that emit greenhouse gases.[2] As of 2022, such bitcoin mining is estimated to be responsible for 0.1% of world greenhouse gas emissions.[3] An August 2023 study found Bitcoin mining represented about 0.38% of global electricity consumption.[4] Bitcoins are usually mined on specialized computer equipment, which has a short life expectancy.[1] As of 2021, bitcoin mining was estimated to produce 30,000 tonnes of annual e-waste, which is comparable to the e-waste production of the Netherlands.[5]

Carbon emissions

Concerns about bitcoin's environmental effects relate the network's energy consumption to carbon emissions.[6][7]

Mining as an electricity-intensive process

Bitcoin electricity consumption
Electricity consumption of the bitcoin network since 2016 (annualized) and comparison with the electricity consumption of various countries in 2019. The upper and lower bounds (grey traces) are based on worst-case and best-case scenario assumptions, respectively. The red trace indicates an intermediate best-guess estimate. (data sources: Cambridge Bitcoin Electricity Consumption Index, US Energy Information Administration; for details, see methodology Archived 11 August 2021 at the Wayback Machine)

Bitcoin mining is a highly electricity intensive proof-of-work process.[2][8] Miners run bitcoin-mining software and compete against each other to be the first to win the current 10 minute block and therefore receive the block reward. The bitcoins are the said block reward. The actual "work" being done by these mining computer systems is not useful in any other way.

As of 2022, the Cambridge Centre for Alternative Finance (CCAF) estimates that bitcoin consumes 131 TW⋅h (470 PJ) annually, representing 0.29% of the world's energy production and 0.59% of the world's electricity production, ranking bitcoin mining between Ukraine and Egypt in terms of electricity consumption.[9][10] George Kamiya, writing for the International Energy Agency, said that "predictions about Bitcoin consuming the entire world's electricity" were sensational, but that the area "requires careful monitoring and rigorous analysis".[11] One study in 2021 by cryptocurrency investment firm Galaxy Digital claimed that bitcoin mining used less energy than the banking system, with Galaxy Digital later clarifying that bitcoin mining's energy usage is not correlated with its "transactional volume or throughput" as it is in banking.[12]

Coal power

Until 2021, according to the CCAF, much of the mining for bitcoin was done in China.[13][14] Chinese miners relied on cheap coal power in Xinjiang[15][16] in late autumn, winter and spring, and then migrated to regions with overcapacities in low-cost hydropower, like Sichuan, between May and October. In June 2021 China banned bitcoin mining[17] and the miners moved to other countries.[18] By December 2021, the global computational capacity had mostly recovered to a level before China's crackdown, with more mining being done in the U.S. (35.4%), Kazakhstan (18.1%), and Russia (11%) instead.[19] Coal power plants in Kazakhstan generate most of the country's electricity and emit lots of local air pollution.[20]

Greenidge Generation, a power plant in Dresden, New York, had originally been built for coal and had shut down in 2011 due to lack of demand. The plant reactivated in 2016 as a natural gas plant but failed to find sufficient demand. It switched entirely to bitcoin mining in 2019. In addition to emitting around 220,000 tonnes of carbon dioxide in 2020, the plant's cooling intake and discharge of heated water into Seneca Lake coincided with a significant decrease in fish and other wildlife populations.[21] In 2022, the plant's air permit request was denied by the New York State Department of Environmental Conservation (DEC).[22][23]

Renewable energy

As of September 2021, according to the New York Times, bitcoin's use of renewables ranged from 40% to 75%.[2] Solar photovoltaic electricity generation appears to be the most economic and geographically diverse method of powering mining.[24] Experts and government authorities have suggested that the use of renewable energy for mining may limit the availability of clean energy for ordinary uses by the general population.[2][25][26]

The Mechanicville Hydroelectric Plant in New York State[27] and three hydroelectric power plants in San Pedro de Poás, Costa Rica[28] have reactivated to mine cryptocurrency. According to the owners of the Mechanicville plant, the mining prevented the plant from being dismantled.[27]


The difficulty of translating energy consumption into carbon emissions is due to the way bitcoin mining is distributed, making it difficult for researchers to identify miner's location and electricity use. The results of studies into bitcoin's carbon footprint vary.[29][30][31] Per a study published in Finance Research Letters in 2021, the differences in underlying assumptions and variation in the coverage of time periods and forecast horizons have led to bitcoin carbon footprint estimates spanning from 1.2–5.2 Mt CO2 to 130.50 Mt CO2 per year.[32] According to studies published in Joule and American Chemical Society in 2019, bitcoin's annual energy consumption results in annual carbon emission ranging from 17[33] to 22.9 MtCO2 which is comparable to the level of emissions of countries as Jordan and Sri Lanka.[31]

In September 2022, a report in the journal Scientific Reports found that from 2016 to 2021, each US dollar worth of mined bitcoin market value also caused 35 cents worth of climate damage. This is comparable to the beef industry which causes 33 cents per dollar, and the gasoline industry which causes 41 cents per dollar. Compared to gold mining, "Bitcoin's climate damage share is nearly an order of magnitude higher" according to study co-author economist Andrew Goodkind.[34][35][36]

Electronic waste

The total active mining equipment in the bitcoin network and the related electronic waste generation, from July 2014 to July 2021.[37]

Bitcoins are usually mined on specialized computer equipment, which produces significant e-waste due to its short life expectancy.[1] Bitcoin's annual e-waste is estimated to be over 30,000 tonnes as of May 2021, which is comparable to the small IT equipment waste produced by the Netherlands. One bitcoin generates 272 g (9.6 oz) of e-waste per transaction. Due to the consistent increase of the bitcoin network's hashrate, mining devices are estimated to have an average lifespan of 1.29 years until they become unprofitable and need to be replaced.[5][38] Other estimates assume that a bitcoin transaction generates about 380 g (13 oz) of e-waste, equivalent to 2.35 iPhones.[39] Unlike most computing hardware, the used application-specific integrated circuits have no alternative use beyond bitcoin mining.[40][37][41]

Reducing the environmental impact of bitcoin is possible by mining only using clean electricity sources.[42][43] Some policymakers have called for further restrictions or outright bans on bitcoin mining.[44][45]


A survey[46] on technologies approached cryptocurrencies' technological and environmental issues from many perspectives and noted the plans of using the methods of unconventional computing and grid computing to make bitcoin both greener and more justified.

Per a 2021 study in Finance Research Letters, "climate-related criticism of bitcoin is primarily based on the network's absolute carbon emissions, without considering its market value." It argues that the inclusion of bitcoin in an equity portfolio reduces that portfolio's "aggregate carbon emissions".[32]

A potential shift from proof-of-work to the more energy-efficient proof-of-stake has been compared to the shift from fossil-fueled to electric vehicles.[44][note 1]

Proposed pairing with variable renewable energy sources

The development of intermittent renewable energy sources, such as wind power and solar power, is challenging because they cause instability in the electrical grid. Several papers concluded that these renewable power stations could use the surplus energy to mine bitcoin and thereby reduce curtailment, hedge electricity price risk, stabilize the grid, increase the profitability of renewable energy infrastructure, and therefore accelerate transition to sustainable energy and decrease bitcoin's carbon footprint.[50][51][52][53][54][24]


  1. ^ Other cryptocurrencies, such as Ethereum, are not proof-of-work but proof-of-stake,[47] which consumes less electricity.[48][49]


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  50. ^ Fridgen, Gilbert; Körner, Marc-Fabian; Walters, Steffen; Weibelzahl, Martin (9 March 2021). "Not All Doom and Gloom: How Energy-Intensive and Temporally Flexible Data Center Applications May Actually Promote Renewable Energy Sources". Business & Information Systems Engineering. 63 (3): 243–256. doi:10.1007/s12599-021-00686-z. ISSN 2363-7005. S2CID 233664180. To gain applicable knowledge, this paper evaluates the developed model by means of two use-cases with real-world data, namely AWS computing instances for training Machine Learning algorithms and Bitcoin mining as relevant DC applications. The results illustrate that for both cases the NPV of the IES compared to a stand-alone RES-plant increases, which may lead to a promotion of RES-plants.
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  52. ^ Moffit, Tim (2021-06-01). "Beyond Boom and Bust: An emerging clean energy economy in Wyoming". UC San Diego: Climate Science and Policy. Currently, projects are under development, but the issue of overgenerated wind continues to exist. By harnessing the overgenerated wind for Bitcoin mining, Wyoming has the opportunity to redistribute the global hashrate, incentivize Bitcoin miners to move their operations to Wyoming, and stimulate job growth as a result.
  53. ^ Eid, Bilal; Islam, Md Rabiul; Shah, Rakibuzzaman; Nahid, Abdullah-Al; Kouzani, Abbas Z.; Mahmud, M. A. Parvez (2021-11-01). "Enhanced Profitability of Photovoltaic Plants By Utilizing Cryptocurrency-Based Mining Load". IEEE Transactions on Applied Superconductivity. 31 (8): 1–5. Bibcode:2021ITAS...3196503E. doi:10.1109/TASC.2021.3096503. hdl:20.500.11782/2513. ISSN 1558-2515. S2CID 237245955. The grid connected photovoltaic (PV) power plants (PVPPs) are booming nowadays. The main problem facing the PV power plants deployment is the intermittency which leads to instability of the grid. [...] This paper investigating the usage of a customized load - cryptocurrency mining rig - to create an added value for the owner of the plant and increase the ROI of the project. [...] The developed strategy is able to keep the profitability as high as possible during the fluctuation of the mining network.
  54. ^ Bastian-Pinto, Carlos L.; Araujo, Felipe V. de S.; Brandão, Luiz E.; Gomes, Leonardo L. (2021-03-01). "Hedging renewable energy investments with Bitcoin mining". Renewable and Sustainable Energy Reviews. 138: 110520. doi:10.1016/j.rser.2020.110520. ISSN 1364-0321. S2CID 228861639. Windfarms can hedge electricity price risk by investing in Bitcoin mining. [...] These findings, which can also be applied to other renewable energy sources, may be of interest to both the energy generator as well as the system regulator as it creates an incentive for early investment in sustainable and renewable energy sources.

Further reading