Even though there is currently a bear market ongoing in the crypto space, it has certainly not stopped the bitcoin bashing that has continued.
More research has been conducted aimed at questioning the impact of mining bitcoin on the environment.
The latest research
On September 29th, the University of New Mexico’s department of economics published the latest research paper, which sheds light on bitcoin’s impact in terms of climate change.
According to the paper, bitcoin, which is often called ‘digital gold’, operates more like ‘digital crude’ than gold when its climate-change impacts are taken into account.
The research attempted to calculate the climate damage related to energy, which occurs because of proof-of-work (PoW) mining of bitcoin, and compared it with other industries.
It said that between 2016 and 2021, every $1 market value of Bitcoin created resulted in climate damages of about $0.35.
The research said that this was higher than that of solar and wind power and the share of market value is in the same range as the burning of crude oil as gasoline and beef production.
According to the researchers, the findings are a red flag for anyone thinking that this sector is sustainable in any way.
The researchers also alleged that even if Bitcoin makes the switch to the proof-of-stake (PoS) consensus protocol, it is still not likely to become sustainable.
They said that if the Bitcoin network does not quit the PoW method, or even if it does shift to PoS, it would still need to be regulated as digitally scarce goods and any delay would result in global climate changes.
The chief executive and founder of Labrys, a blockchain development agency based in Australia, Lachlan Feeney also recently talked about this topic.
He said that since the Merge event occurred and Ethereum switched from PoW to PoS, there is increasing pressure on the Bitcoin network to justify the use of the PoW algorithm in the long run.
However, counterarguments and comparisons are also to be expected.
According to a report from the University of Cambridge, the energy consumption of the Bitcoin network is currently around 94 terrawatt hours (TWh) a year.
Putting this into context, the electricity consumption of all the refrigerators in the United States alone is around 104 TWh a year, which makes it significantly more than the Bitcoin network.
In addition, there are about 206 TWh a year of electricity losses in distribution and transmission, which could be used to power the Bitcoin network about 2.2 times.
According to Cambridge, there has been a 28% decline in the power demand of the Bitcoin network since mid-June.
This is likely because of the adoption of energy-efficient mining hardware used and fewer mining activities due to the crypto bear market.
Furthermore, renewable energy is also being used to carry out mining activities, particularly in the US, as there has been an influx of mining companies in the country since China imposed a ban.