The Environmental Impact of Cryptocurrency

Are you worried about how cryptocurrency can adversely affect our environment? Cryptocurrency itself doesn’t have any negative effects as it’s a form of digital currency that is not available physically. However many resources are used to maintain it.

Now the major environmental impact related to cryptocurrency is “Mining”. Do you know what mining is? It’s the process in which transactions are validated and added to the blockchain.

For this process miners use powerful computers which can significantly affect our environment. Let’s take a look at the major effects it causes and ways to reduce it. Read ahead.

3 Major Environmental Effects of Cryptocurrency

The environmental footprints of the increased adoption of cryptocurrency and its mining are concerning. The significant impacts of cryptocurrency mining are mentioned here:

1.   High Carbon Emissions

Mining cryptocurrencies resulted in increased emission of Carbon Dioxide in the atmosphere. And everyone is aware of the consequences of increased concentration of Carbon Dioxide. This is a major concern as almost 75% of the greenhouse gasses are made due to increased carbon emissions.

It has been estimated that Bitcoin mining produces almost 73 million tons of carbon dioxide every year. This carbon emission is equal to the total emission by the country Oman. Furthermore, Ethereum mining also produced 35 million tons of carbon in 2022.

Increased carbon emissions are causing Global warming. Therefore there is a need to address this issue as soon as possible. Just make sure the alternatives have the ability to accept crypto through a secure platform. This payment gateway allows you to accept and send Bitcoin and other cryptocurrencies. It is one of the most secure payment gateway currently in the crypto space.

2.   Increased Electronic Waste

Cryptocurrency mining is done on powerful computers utilizing large amounts of electricity. The high energy needs lead to significant electronic waste. Huge machinery like Application-Specific Integrated Circuits (ASIC) was introduced specifically for mining purposes. These machineries used to consume a large amount of energy.

But they had no other purpose and became obsolete after the technological advancements. According to research, Bitcoin mining causes electronic waste of 72,500 tons annually. The electronics waste usually contains hazardous materials like lead and mercury. Hence, it can cause harm to the environment if not recycled effectively.

3.   Excessive Water Usage

The powerful mining operations produce a lot of heat as a byproduct. This heats the systems and needs cooling systems to prevent overheating. Various mining firms use water to cool down the machinery to manage heat production.

These mining firms then discard the heated water to nearby lakes and rivers. This water damages the quality of water. Water discharge often contains water pollutants that are harmful to aquatic life.

Day by day the strain on these water resources is increasing. These growing mining processes are compromising our water resources. It’s absolutely necessary for us to act quickly and find some other more sustainable ways to use cooling methods so that our water bodies can be saved.

5 Ways To Reduce It

It has now become necessary to reduce these hazardous impacts of cryptocurrency mining or else it can become a bigger problem in the near future. If we want to reduce these effects, we need to:

1.   Use Renewable Energy Sources

The first thing we need to do is shift mining operations to regions that are rich in renewable resources. This will reduce the usage of excess electricity and will also decrease carbon emissions.

If these operations are in a developed country like the United States then they can use solar power and geothermal energy to run them. This way we all can move towards cleaner energy alternatives.

2.   Actions by Government

The government also plays a crucial role in reducing the negative effects of crypto mining. They can enforce several measures and set up energy-efficient standards.

This shift towards environment-friendly mining must be supported by the governments or else it will all go to waste. The government should also provide financial support to organizations that are looking for ways to improve our environmental health.

3.   Utilize Energy-Efficient Systems

Energy-efficient technological systems including a “Proof of Stake” system must be used instead of Proof-of-Work. It can reduce the energy consumption significantly. Ethereum has switched from Proof-of-Work to Proof-of-Stake to conserve energy. This has reduced the energy use to over 99.9%.

4.   Take Legislative Measures

Various cryptocurrencies have not yet implemented the use of energy-efficient systems for mining purposes. For instance: Bitcoin and many other cryptocurrencies are not switching to Proof of Stake because of lower profit margins There is a need for proper legislation against these cryptocurrencies.

Conclusion

Cryptocurrency mining is negatively impacting our environment. However it is not possible for us to eliminate the use of cryptocurrencies as it has become mainstream with trillions of dollars at stake. There are still tons of debates online about whether cryptocurrency is causing any environmental hazards or not.

Some analysts say that these effects on the environment are justified. This is because these virtual currencies also provide several benefits. However others argue that the expensive and powerful machinery and the excessive use of power are notably causing distress to the environment.