Bitcoin, the first cryptocurrency ever that was created about a decade ago, introduced us to the world of decentralised computing. With no centralized authority acting as the intermediaries, it soon became evident that it granted users more control over their assets and provided an inexpensive, faster, secure platform to store them. All these favourable aspects considered, when you look closely at the technology, it does not really provide all these advantages without a cost. These is a cost associated with its use and that cost is energy.
To elaborate that, we look at the mechanism of Bitcoin and its blockchain. A blockchain consists of blocks, which carry transactions. For a transaction to be approved and chained up with the existing chain, there is a consensus mechanism set in place. Bitcoin uses Proof Of Work (PoW), whereas there are many variations that are being employed by other cryptocurrencies. This consensus algorithm is what makes mining Bitcoin extremely resource intensive. Miners, the users who mine Bitcoin, have to solve a complex mathematical problem, through brute force, which can be provided by only heavy computational machinery, or mining rigs as they are called. The chances of a miner successfully mining a coin or finding the nonce, is directly proportional to the amount of machinery he/she has utilized. The heavier the machinery, the more electricity is consumed.
This isn’t the only dilemma surrounding PoW. With Bitcoin, the more coins are mined, the complexity of mining the rest increases. This implies that the energy consumption will only increase with the passage of time.
The energy that is now being consumed by the mining rigs in mining farms is majorly sourced from the non renewable resources of energy that consists of coal mines, fossils and petroleum. These are responsible for the release of a plethora of greenhouse gases that are destroying our precious environment. It had been preliminarily estimated that a total of 132 years will be required to mine all the bitcoins that are 21 million. Where Bitcoin already consumes 0.15% of the world’s energy it is hard to imagine how much the cost would go up as time progresses. Some have also voiced their concerns about how Bitcoin mining that required only a PC or a laptop could consume as much electricity as entire countries in the upcoming years.
Bitcoin and the underlying technology Blockchain are a product of the new era. Rather than leaving a harmful impact on the environment, they should be inclined towards the adoption of better energy reserves for empowering their projects. Mother Earth is full of blessings, in this case natural, renewable sources of energy are the ones we need to employ. The renewable resources include solar, wind, Geothermal, Hydropower and Tidal power. These can be acquired and used instead of the ones that adversely affect the environment.
Since the harmful implications of using non renewable resources of energy started causing concerns to the world, there have been a number of projects who have taken the initiative to power their projects without causing any harmful impact to the environment. GEAR a blockchain project designed to create environmental sustainability by consuming energy from green energy mining facilities to invest in coins based on Proof of Stake (PoS), rather than PoW. Another green project that is worth mentioning is Soluna, based in Morocco, who have acquired a Class 1 wind farm, to produce green energy to power their very own blockchain. While these projects have been fleeing from the use of non renewable resources of energy, it is also important that they invest in the research and development of cleaner and greener sources of energy.
In a nutshell, Bitcoin may be the innovation of the new era, but one cannot turn a blind eye to its detrimental effects to the environment. Where PoW provides security, it is also turning into a tool of mass destruction of our planets environments. So a swift migration to the non renewable resources may well in order.