The recent increase in the value of past $38,000 has brought not only profits to investors but also increased concerns about the environmental impact of cryptocurrencies. A study published in Cell Reports Sustainability draws attention to the significant water use of Bitcoin transactions, averaging 16,000 liters per transaction. This amount is equivalent to filling a garden swimming pool and contributes to a staggering global total of more than 1,600 gigalitres by 2021. The environmental ramifications are particularly worrying in areas of scarcity countries such as Central Asia and the United States.
Alex de Vries, a researcher examining the cryptocurrency footprint, predicts water consumption will increase by more than 40% if this trend continues, driven by the heavy use of Proof of Work (PoW) mechanisms. Energy underpins Bitcoin mining. This process requires significant computing power, leading to the need for extensive cooling systems for data centers and power plants.
Reliance on renewable energy sources, often touted as a solution, is criticized by de Vries for being insufficient to offset the environmental impact of their limited availability. Instead, he pointed to the Proof of Stake (PoS) model, which Ethereum switched to in 2022, as a more sustainable alternative. PoS reduces the need for power-intensive hardware by allowing cryptocurrency holdings to increase transaction validation, a move that does not reduce Ethereum’s popularity or functionality.
As the cryptocurrency community looks to the future, especially around 2040 when Bitcoin mining is expected to end with the mining of the last coin, de Vries warns that miners must stay away from unsustainable movement. Without adapting their technology, they risk being caught in a losing game against environmental sustainability, a scenario that could have serious implications for the long-term viability of the industry.
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