Change in coding could reduce bitcoin energy consumption
4 Min Read
Climate groups say a change in coding can reduce bitcoin energy consumption by 99%.
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Changes in coding could reduce bitcoin energy.
Some statistics revealed that bitcoin mining already consumes as much energy as Sweden, and its brisk popularity is reviving failed fossil fuel firms in the United States. According to a campaign started on Tuesday, all of that might be altered with a simple adjustment in the way it is coded.
Modify the Code, Not the Climate, a campaign coordinated by the Environmental Working Group, Greenpeace USA, and other groups fighting bitcoin mining operations in their towns, is calling on bitcoin to change the way bitcoins are mined to reduce its massive carbon footprint.
Bitcoin's software code, known as "proof of work," necessitates the deployment of large computer arrays to validate and secure transactions. Proof of work is a method of verifying that a miner has solved the exceedingly difficult cryptographic puzzles required to contribute to the bitcoin ledger.
A competing cryptocurrency Ethereum is switching to a new mechanism called "proof of stake," which it thinks will cut its energy use by 99%. Miners promise their currencies to verify transactions under the proof of stake model; adding incorrect information results in fines.
Read more: Cryptocurrency: Where Is It Heading?
With the value and use of cryptocurrencies increasing, the organizers of the campaign claim that bitcoin must follow suit or find another, less energy-intensive approach. "This is a major issue. In part because of where the business is currently, but also because we are concerned about its growth," said Michael Brune, Sierra Club campaign director, and former executive director.
Following China's crackdown on mining and trade last May, the United States currently leads the world in cryptocurrency mining.
“Coal plants which were dormant or slated to be closed are now being revived and solely dedicated to bitcoin mining. Gas plants, which in many cases were increasingly economically uncompetitive, are also now being dedicated to bitcoin mining. We are seeing this all across the country,” said Brune.
Brune added, “It’s particularly painful to see this in the electric sector because that is precisely the place where the US has made most of its progress in the last decade."
“There’s no way we can reach our climate goals if we are reviving fossil fuel plants."
Some bitcoin miners have recently begun employing renewable energy sources such as wind and solar to power their operations. While such measures are "obviously well-intentioned," Brune believes that "few boutique winds or solar plants powering a few high-profile mining activities" will not be adequate to offset the environmental cost. “Fossil fuel growth is outpacing renewable growth in bitcoin mining and that’s the fundamental challenge,” Brune said.
The basic issue will remain that bitcoin's programming "incentivizes maximal energy use," according to Chris Larsen, creator and executive chairman of the crypto firm Ripple and a climate activist. “The minute that there is the opportunity to go to something dirty, which is what you are seeing, that is going to happen.”
Read more: The White House Considers Measures to Monitor Cryptocurrency Use
One “nightmare scenario”, he said, is that the world does get to a renewable future in China, the US, and the EU, but countries rich in fossil fuel switch to bitcoin mining to keep their operations running.
“Imagine the Saudis sitting on all that oil, which has a cost of about ½ cent per kilowatt-hour – no renewable can match that,” Larsen said. “Bitcoin mining could be this endless monetization engine for fossil fuels. That would be a nightmare.”
The campaign will kick off with digital ads in the Wall Street Journal, New York Times, Marketwatch, Politico, Facebook, and other outlets. Organizers are also suing planned mining sites and leveraging their massive membership to pressure bitcoin's major investors and influencers to advocate for a code update. "There has to be a better solution in this world, with all these educated people," Larsen remarked.
