The incoming mayor of New York City thinks that cryptocurrency and blockchain technology are the future. Eric Adams has advocated for reshaping the city into a crypto hotspot, with crypto being taught in schools. He also plans to take his first three paychecks in the bitcoin payment.
Adams said in an interview that bitcoin was the "new way to pay for goods and services around the world" and that schools "must" teach the technology behind it, as well as "this new way of thinking."
He is not alone in the United States. The mayor of Miami announced in February that the city plans to accept tax payments in bitcoin and allow employees to draw their salary in cryptocurrency. Crypto conferences like Bitcoin 2021, listed as the largest bitcoin event in history, has chosen Miami as its host city because the area has rolled out the red carpet for this industry.
But not everyone agrees with the crypto vertigo expressed by the US political class. Cryptocurrency mining is notoriously bad for the environment, and in an era of rapid climate crisis, increasing the use of technology could be dangerous.
According to Digiconomist, a single bitcoin transaction uses the same amount of energy the average American household consumes in a month, which is roughly a million times more carbon footprint than a single credit card transaction. And globally, the bitcoin carbon footprint mining is greater than that of the United Arab Emirates and is just below that of the Netherlands ”.
People should be concerned about the environmental and climate impacts of mining “proof-of-work” cryptocurrencies like bitcoin, said Benjamin A Jones, an economist at the University of New Mexico.
Such coins require miners to compete to validate transactions on their blockchains, and that requires huge, power-hungry servers. Bitcoin mining uses power predominantly generated from fossil fuels, which creates air pollution and carbon emissions, Jones said.
"These polluting emissions are harmful to human health and carbon emissions cause climate damage," he added.
Jones is a recently co-author a paper which estimated that in 2018 every $ 1 worth of bitcoin created was associated with $ 0.49 in damage to health and climate in the US, meaning negative costs to human health and climate impacts of bitcoin mining in the US were about half that per coin value.
"This is a tremendously negative externality of bitcoin mining that is imposing significant social costs on all of us," he said, "even those who don't use bitcoins or cryptocurrencies."
Since cryptocurrency mining requires so much energy, it is often located near the cheapest and least regulated energy sources. The harms Jones and his colleagues noted stem from increased pollutants generated by burning fossil fuels used to produce energy. Exposure to pollutants such as fine particulate matter has been linked to an increased risk of premature death.
Last month, a group of 70 climate, economic and racial justice groups wrote a letter to Congress urging leaders to address the climate implications of cryptocurrencies. The letter cites the extreme levels of carbon emissions, energy consumption, and e-waste generated by cryptocurrency use, production, and mining, especially the energy-intensive proof-of-work process used by the two largest cryptocurrencies. bitcoin and ethereum.
Cryptocurrency-related mining already has an impact on local communities such as Seneca Lake, New York, and Limestone and Jonesborough in Tennessee, through environmental destruction, noise pollution and falling property values, the letter says. Residents say Seneca Lake has become very hot due to the lake's increased demand for energy. like a jacuzzi. The power plant there is already increasing its carbon emissions, almost to ten times in 2020.
Texas also has a problem. After China's crackdown on bitcoin mining, many miners moved to Texas, where the power grid is deregulated. Environmental groups say the added pressure on the Texas grid could cause more blackouts like the ones that happened in February, when homes were plunged into dark and icy circumstances.
Other parts of the country are rebooting coal plants to boost bitcoin mining.
"The destructive impact of cryptocurrency on the environment is just another example of how corporations in a financialized economy will stop at nothing to generate profits for investors, and how communities of color will ultimately pay the price," Erika Thi Patterson the Action Center on Race and the Economy wrote in the letter.
“Cryptocurrencies and their miners rely on harmful fuels like coal that produce toxic emissions related to asthma, cancer, acid rain, and climate change. In doing so, the cryptocurrency is exacerbating decades of environmental racism and fueling climate chaos. "
Sierra Club Deputy Legislative Director Patrick Drupp said: “It is beyond absurd that as we speak and the climate crisis is only deepening, fossil fuel power plants are having their lives extended and even reopened to virtually 'mine' cryptocurrency. . At a time when financial regulators should do everything they can to help address the climate crisis, it is clear that the status quo of allowing bitcoin and other cryptocurrency miners to pollute our climate and communities at an exponential rate is unsustainable, reckless, and urgent. action."
Embracing cryptocurrencies means that America's political leaders and policymakers must confront the environmental and climate damages generated through mining operations, Jones says. "For bitcoin in particular, one cannot embrace the currency without also acknowledging its impacts on the environment."
