Opinion: The Real Price of Bitcoin (Mining Farms)
Recent reports suggest the ecological price of Bitcoin mining farms might be immense. It’s time for the industry to right some wrongs
After a few uncertain years, the last years have been incredible for cryptocurrency enthusiasts in general and Bitcoin investors and fans in particular. Cryptocurrency has gained legitimacy in the public eye, with some of the biggest actors across all sectors accepting it and reacting to it.
As has been reported extensively in FinLeaks, hardware manufacturers are releasing devices designed to cater for its needs, retailing giants are placing cryptocurrency cash points in their stores and many of the biggest names in the tech sector are hoping to launch their own cryptocurrency (most notably, Facebook’s ‘Libra’). Moreover, cryptocurrency has been a real political game-changer, with many living in unstable economies turning to it as a potential solution to their monetary struggles and many countries, like China, making strides towards launching their own brands. Cryptocurrency has been a real disrupting force, bringing on positive change around the world. Recent reports suggest that the effects it has on the planet, might need to be checked.
Bitcoin mining is a process of generating new units of currency by solving complex mathematical problems. It was made this way in order to regulate the pace in which bitcoins are being ‘produced’ and limit the market saturation in order to avoid price inflation. The problem solving required, uses great amount of computer processing power and is particularly energy intensive.
According to recent industry estimates, the global mining of bitcoins requires an equal amount of energy to the amount used by Ireland (!) and some experts fear the spread of mining farms in third world countries might threaten the environment and hasten climate change. A recent study found that carbon-emissions produced by bitcoin mining are likely to push global warming by as much as 2 degrees Celsius within 20 years.
This calls for an explanation. Bitcoin mining farms are not a danger within itself. In fact, many of the bitcoin mining farms operating in the Western world, particularly the vast mining farms located in Iceland and Norway, operate on green, clean energy. However, in recent years, we have witnessed many of the mining operations being relocated to third world countries, where the operation costs are significantly lower, and the farms rely on cheap coal energy to run.
It might be time for the industry to join forces and offer coherent and cohesive energy solutions to the bitcoin mining companies, in order to ensure that their profitability does not bring about environmental catastrophe. The much welcomed, and in my opinion necessary disruption of the rigid and corrupt global monetary system by cryptocurrency, should not come at such unbearable price and it is the industry’s duty to make sure it will be done in the safest and cleanest way possible.