Cryptocurrencies such as Bitcoin have no physical form. You cannot hold them in your hand like a dollar bill. But they have a real impact on the climate.
That’s because the most common process used to validate cryptocurrency transactions – and to bring new cryptocurrency into circulation – requires a huge amount of computing power.
And all that computing takes a lot of electricity — in the case of Bitcoin, as much as a country.
“We’re talking … 110, 120, 130 terawatt-hours,” says Benjamin Jones, an associate professor at the University of New Mexico. “That’s like in the ballpark of Norway, what they would use in a single year.”
Jones says much of that electricity comes from fossil fuels, so it creates carbon pollution.
“But there’s also solutions that are readily available for us to solve this as well,” he says.
He says cryptocurrency companies can use processes that require far less computing power.
Ethereum, the world’s second-largest cryptocurrency, is adopting a method that the company expects will cut electricity use by 99%.
And the industry can rely more on clean, renewable energy.
So Jones says it’s possible to have cryptocurrency without so much environmental harm.
Reporting credit: Sarah Kennedy/ChavoBart Digital Media