The sharp drop in the value of cryptocurrencies in recent weeks will not reduce the climate impact or energy consumption of these assets. Although, in theory, the ecological footprint of cryptocurrencies depends on its value in the market, the intensive use of energy remains the same and apart from market disturbances.
The decline in the value of cryptocurrencies is not accompanied by a reduction in their energy consumption
Alex de Vries is a data scientist working for the German Central Bank, as well as one of the world’s leading experts on the environmental and energy impact of cryptocurrencies. De Vries is the founder of Digiconomist, a website that monitors the sustainability and energy consumption of crypto projects.
“Unless Bitcoin crashes, there is no reason to expect a decrease in its environmental impact”has written de Vries.
His research shows that the intensive use of energy by the computers that generate cryptocurrencies increases as prices rise. However, by lowering the value, electricity consumption does not decrease at the same rate, so the environmental impact is the same.
De Vries’ estimates indicate that Bitcoin networks consume around 204 terawatt hours every year. Is about the same amount of electricity that Thailand consumes, with almost seventy million inhabitants, over the course of a year. To this should be added the environmental impact of the other cryptocurrencies. Ethereum, for example, consumes about 104 terawatts per year, the same as all of Kazakhstan.
De Vries himself led another study a few months ago in which he concluded that Bitcoin mining produces about 30,700 tons of electronic scrap each year. On average, each cryptocurrency transaction generates 272 grams of electronic scrap. An iPhone 13, for comparison, weighs 173 grams. According to the data collected, the computers used for Bitcoin mining become obsolete very soon. On average, these devices have a life expectancy of just 1.29 years.