Could Crypto Mining Be Used To Address Climate Change?

Cryptocurrency mining is a power-intensive process that puts pressure on national grids in places where they operate. Recently, they have been fears that these activities could lead to global warming. Some even claim the process of creating new virtual currencies does more harm on the environment than burning coal.

Cryptocurrencies, unlike fiat currencies, have a limited supply. For instance, the maximum number of Bitcoin is 21 million. However, this number has not yet been achieved. Whereas the process of creating new coins was easier a few years ago, it is now a more complex process that requires more powerful machines than those used in the past. This means the power needed in Crypto mining is increasing every day.

In the past, many have been luring Crypto miners to move to their regions. However, after the realization of the impact of this activity on the environment, some are shunning these companies. Cities such as New York have banned Cryptocurrency mining. However, at this time, it is advisable to find out if Crypto mining could be used to counter climate change.

Using Renewable Sources Of Energy

Although most Crypto mining takes place in China because of cheap energy, coal is the main source of electricity in this country. This justifies the claim that mining may lead to global warming. Nevertheless, miners are not restricted to using energy from such harmful sources. They can turn to clean energy.

Solar, wind, and hydro are known to be clean sources of energy have a little adverse impact on the environment if any. Cryptocurrency miners should go for these sources to reduce or even eliminate climate change caused by their activities. If miners were to go for green energy, the high demand for energy would lead to the development of this industry. It could also lead to the use of better and more efficient technology in clean energy production.

Improve Efficiency In Crypto Mining

Most Cryptocurrencies use the proof-of-work algorithm. However, this process is expensive in terms of the complexity of the mathematical puzzles to be solved leading to high-energy consumption. Given that the demand for the virtual currencies is growing every day, more people are getting into Crypto mining leading to the consumption of more energy.

Producers of Crypto mining devices are developing new machines that are more efficient. Major achievements have been recorded in the improvement of computer chips, which enables them to create new coins at a faster rate than the previous ones. There has also been the need to improve the Bitcoin protocol. For instance, Lightning Network update has improved efficiency as it supports off-chain and on-chain transactions.

Introduction Of Other Protocols

Although the current proof-of-work mining process used in Bitcoin has been hailed for controlling Blockchain manipulation, it is power-intensive. Recently, they have been attempts to try alternative protocols that require less energy. For instance, Ethereum is now trying Casper, a proof-of-stake algorithm. The new process is cheaper in terms of power consumption than the proof-of-work process.

Although there is not enough data to help in establishing how Crypto mining will affect the environment, certain people such as Alex de Vries, a Dutch economist are analyzing this industry. Given that it is clear the process of minting new coins is energy intensive, it is advisable for the miners to adopt practices that will have little impact on the environment.