Is E-Waste Of Bitcoin Mining A Threat To Our Environment
Bitcoin is a digital currency that can eliminate the concept of inflation in the financial segment. You are familiar with the fact that fiat currencies have an infinite supply. All the more, government authorities can destroy and create new currencies to improve economic infrastructure. Therefore, changes in the supply of fiat currencies always cause inflation.
And this is one of the prominent reasons why the market price of goods and services incline with time, whereas the value of currencies remains the same. However, bitcoin comes up with a finite supply, and bitcoin miners can merely mine 21 million bitcoin units.
The finite supply of bitcoin can give an ultra-hedge towards inflation as the supply of bitcoin is constantly declining, increasing the demand for bitcoin, and the store value of bitcoin is increasing. So the value of goods and services might increase with time, but the store value of bitcoin will increase with time.
Since bitcoin is a digital currency, creating new bitcoins is correspondingly digital and is famous as bitcoin mining. There are websites that discuss bitcoin as a hedge against inflation which can help you in getting profitable results in your bitcoin trading expedition. Bitcoin mining produces a lot of e-waste but is it that bad for our environment? Here is an utter portion demonstrating the solution to your query. So without wasting any further ado, let’s jump straight to the facts.
Nuts and Bolts of Bitcoin mining
Undeniably, bitcoin mining is one of the most tempting and profitable businesses, but it is essential to the bitcoin complex. Bitcoin mining is a computerized process. The reason bitcoin is analogous with gold is that bitcoin is also scarcer, and the process of extracting bitcoin units from the bitcoin algorithm is correspondingly mining.
Mining is not merely the process of adding more bitcoin units to circulation but correspondingly verifying bitcoin transactions.
Bitcoin miners can verify the transactions by solving a math puzzle in 10 minutes. Bitcoin miners solve the math puzzle to guess a hash function to assign to every transaction. Miners have to solve the math puzzle before the other bitcoin miners get bitcoin units as the block reward.
Why is Bitcoin mining an energy guzzler?
Bitcoin mining consumes a massive chunk of electricity to process the transactions on the blockchain. The prominent reason behind this fact is proof of work. Therefore, proof of work is the primary mechanism of bitcoin mining.
Proof of work ensures that a bitcoin miner has to solve math puzzles to prove the usage of computers to validate the transactions. All the more, proof of work does not render any requirement to an individual for bitcoin mining. The only requirement for starting a bitcoin mining venture is robust bitcoin mining hardware.
The specialized bitcoin mining hardware is also famous for application-specific integrated circuits. Since there is massive competition in the bitcoin mining industry, every bitcoin miner has to fight over to win a block reward due to no restrictions. If a bitcoin miner fails to solve the math puzzle earlier than other miners, he has to restart the process. Bitcoin miners merely use electricity as the only energy source to mine bitcoin units.
Are environmental impacts of bitcoin mining severe?
Undeniably bitcoin mining is impacting our environment in an enormous amount. As mentioned ahead, bitcoin miners merely use electricity as the only energy source. Due to extreme electricity consumption, there is a burning of fossil fuels to an exceeding extent. The burning of fossil fuels, especially coal, is the only reason for e-waste as it emits greenhouse gas to an exceeding extent.
The fact might amaze you that bitcoin mining generates e-waste of 272 grams with every transaction. The greenhouse gas emission of bitcoin is about to reach a milestone of 90 million metric tons. However, the environmental impacts of bitcoin mining are declining day by day as the criticism on bitcoin mining is mounting.
As per the statement of the bitcoin mining council, bitcoin miners are now using more than 56% green energy. So, in a nutshell, bitcoin mining is now using more green energy than most developed countries. All the more, Elon Musk has also announced to resume bitcoin payments after analyzing this data.
The portion mentioned above is everything you should know about the impact of bitcoin mining on our environment.