Is crypto mining harmful to the environment?

Bitcoin mining is enormously harmful to the environment. the design of the Proof of Work (PoW) consensus algorithm is energy wasteful as part of its design. There are three factors that give rise to its inordinate environmental footprint which is incommensurate with its generated utility.

  1. E-waste from discarded or broken ASIC mining equipment, graphics cards and servers.
  2. Carbon release from fossil fuels used to power mining data centres
  3. Opportunity cost of the energy used to run consensus algorithm compared to more efficient of efficient real time gross settlement systems and traditional payment rails such as SWIFT, SEPA, Visa and ACH.

BItcoin mining has the equivalent power consumption of the state of Argentina, a country with a population of 45 million people. Bitcoin mining has an e-waste footprint comparable to that of entire population of Germany.

Bitcoin mining collectively consumes more power than all data centres run by Google, Amazon, Microsoft, Apple, Netflix, Facebook and YouTube put together.

Bitcoin is simply one of thousands of crypto assets which use PoW algorithm, including the second largest asset Ethereum which together with all other assets sum to an even larger and difficult to calculate environmental footprint.

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