Using bitcoin to pay for your morning coffee could be compounding. As crazy as it sounds, this high-tech digital currency has a real impact on the environment, and some researchers believe it might even push Earth closer to the brink.
In a study published Monday in the journal Nature Climate Change, researchers from the University of Hawaii found that large scale bitcoin mining has the potential to catapult us past the warming threshold set by the Paris Agreement in just 16 to 22 years. That's two to three times faster than the current pace of warming.
The estimate of 16 years is assuming an average rate of bitcoin adoption compared to other technologies; the estimate of 22 years assumes a slower adaption rate than normal.
"We cannot predict the future of Bitcoin, but if implemented at a rate even close to the slowest pace at which other technologies have been incorporated, it will spell very bad news for climate change and the people and species impacted by it," the lead author of the study, Camilo Mora, said in a press release. Mora is an associate professor of geography at the University of Hawaii Manoa.
The researchers estimated that last year alone, use of bitcoins emitted 69 million metric tons of the greenhouse gas carbon dioxide, or CO2, into the atmosphere. That's the equivalent of 17 coal-fired power plants running for a year, the EPA estimates.
The recent CBSN Originals documentary, "Cryptocurrency: Virtual Money, Real Power," makes it easy to understand why bitcoin mining is so energy intensive. (Watch the video at the top of this page.) In the very first moment of the video you can hear server farms buzzing away at computationally demanding tasks. The machines are eating up prodigious amounts of power computing and recording transactions, while industrial-strength fans run constantly to cool them off. Just one of the mining pods seen in the film uses as much power as 600 residential homes. Once a transaction is complete the miners are rewarded with more bitcoin, and the process continues around the clock.
The owners of these bitcoin businesses believe this is the future of money. If that's true, what does it mean for the future of our planet? Climate scientists say that crossing the 2-degree Celsius threshold (3.6° Fahrenheit) would take humanity into the unknown; the world would be a profoundly different place with complete loss of coral reefs, dramatically higher sea levels, displaced human populations and , just to name a few of the impacts forecast.
But supporters of cryptocurrency say the worry is overblown. In a recent article on Bitcoinist.com, the author, Osato Avan-Nomayo, gives reasons why he believes the "energy consumption rhetoric is pure nonsense." He argues that technological innovation as well as off-grid and sustainable energy sources will limit the power being guzzled from the grid to fuel the growth of bitcoin.
We see this rush for cheap, sustainable energy at the heart of the controversy in CBSN's documentary, as the town of Wenatchee, Washington, grapples with allowing its valuable hydropower from the Columbia River to fuel a growing number of cryptocurrency operations. Using hydropower limits costs for operators and limits heat-trapping greenhouse gas emissions.
However, the authors of the new study claim they have taken geography and power sources of bitcoin mining into consideration, and still see a worrying impact on the climate. The researchers analyzed the likely geographic locations of the cryptocurrency mining operations, the CO2 emissions of mining bitcoin in those countries, and power efficiency to predict future energy consumption.
There's no telling what future market growth, competition and innovation will mean for the extent of energy efficiency. But Mora says, "Clearly, any further development of cryptocurrencies should critically aim to reduce electricity demand, if the potentially devastating consequences of 2°C of global warming are to be avoided."