On Thursday, the White House Office of Science and Technology Policy issued a warning that the usage of bitcoin mining equipment would make it more difficult for the nation to combat climate change. Additionally, it stated that in order to comprehend and address the issue, government agencies should take into account data from cryptocurrency miners and municipal utilities “in a privacy-preserving manner.”
According to a report by the White House, crypto operations currently use as much energy as all personal computers or all household lighting combined in the United States. The findings are being criticized increasingly for how much electricity cryptocurrency mining companies use.
In order to generate new coins and verify transactions, the process of mining cryptocurrencies entails running banks of computers to tackle challenging math problems. The most widely used cryptocurrency, Bitcoin, is committed to this “proof of work” methodology, while the second-most widely used cryptocurrency, Ether, is switching to an alternative approach that could not use as much energy.
According to the paper, although the estimations are tentative, the manufacture of cryptocurrencies in the United States accounts for 0.2% to 0.3% of domestic emissions and 0.4% to 0.8% of global emissions. Burning coal, natural gas, and other fossil fuels to produce energy for cryptocurrency mining is the main source of emissions that contribute to global warming.
According to the analysis, global carbon pollution from crypto mining was between 110 and 170 million metric tons this year, with between 25 and 50 million metric tons created in the United States alone. In the process, electricity is generated either by purchasing it from the power grid or by creating and deconstructing mining equipment and computers.
“Electricity usage from digital assets is contributing to GHG emissions, additional pollution, noise, and other local impacts, depending on markets, policies, and local electricity sources,” in the report, the White House stated.
“Depending on the energy intensity of the technology used, crypto-assets could hinder broader efforts to achieve net-zero carbon pollution consistent with U.S. climate commitments and goals,” it added.
The executive order signed by President Joe Biden in March directing the government to assess the advantages and disadvantages of cryptocurrencies led to the creation of the report. By 2030, the president promised to cut American emissions from 2005 levels by at least half and to reach net-zero emissions by 2050.
According to the analysis, global emissions from crypto mining are comparable to those of all barges, tankers, and other ships operating on inland waterways and exceed those of several individual nations. Additionally, around two-thirds of all greenhouse gas emissions from cryptocurrencies are produced by Bitcoin, the largest digital currency in the world by market value.