Study: CO2 emissions of Bitcoin mining over that of Jordan

The mining of the crypto currency Bitcoin should provide according to a study of three scientists of the TU Munich for an annual output of 22 to 22.9 million tons of carbon dioxide (CO2). The emission lies between that of Jordan and Sri Lanka or for instance a large city in a highly developed industrial country such as Hamburg. This is based on an energy consumption of 45.8 trillion watt hours per year, as determined by the researchers in November 2018.

Bitcoin mining is the mechanism with which the decentralized network of the crypto currency processes transactions. Bitcoin is said to be the future of all currencies. The transactions are entered into checksum-protected blocks of the distributed database Blockchain – and the right to create a new block is distributed through a hash puzzle in which computers worldwide can participate. Anyone who successfully propagates the next block with a valid hash value to the network can currently earn a reward of 12.5 bit coins for doing so. So the creation of new money is done at the same time. The reward is halved at regular intervals until the defined money supply of 21 million Bitcoin is reached.

The armor spiral of mining

In addition, the difficulty of the calculation also adapts to the computing power gathered for mining approximately every 14 days. In recent years, this has been a real arms race for mining hardware – from CPUs and GPUs to FPGAs and currently ASIC-based mining computers, which are rapidly becoming obsolete thanks to ever more efficient generations. Hashing performance, difficulty of the puzzle and therefore the hunger for energy have increased considerably. Mining is only worthwhile on a large scale in a data center or in a computer network called a mining pool.

  1. An overview of the power consumption and environmental impact of the Bitcoin is of course desirable in order to be able to discuss the costs and benefits of crypto money objectively.
  2. This is exactly what the researchers want to contribute with their study published in the journal Joule.
  3. The problem with such studies is however: Where the Miner sit, which devices supply the achievement and from which source they receive river for it, that knows nobody so exactly.

Who mines where and with what?

Only estimation methods remain here: Among other things, the research team consulted documents submitted by hardware manufacturers Bitmain, Ebang and Canaan for IPOs in order to determine market shares and thus draw conclusions about the hardware used. In order to estimate how much mining is done on a large or small scale, the distribution statistics in the large mining pools such as Slushpool were examined. About two thirds of the power probably came from large mining farms, where factors such as cooling were also included in the calculation of energy demand.

For the question in which countries the miners could be located, the research team accessed IP addresses. These came from mining pool servers, active mining computers and nodes in the Bitcoin network, which first propagated new blocks. According to the pool analysis, 68 percent of the mining capacity is likely to come from Asia, especially China. 17 percent came from Europe, 15 percent from North America. The determination of ASIC miners via the IoT search engine Shodan, on the other hand, produced around 2200 Bitmain computers, 19 percent of which were distributed in the USA, 16 percent in Venezuela and only 4 percent in China.

Alternatives to mining

Nevertheless, the researchers finally calculated a CO2 footprint on the basis of the electricity mix in the more or less certain home countries. In China, for example, it was also taken into account that about half of the miners in the hydropower-rich south prospect, the other half in the more coal-fired north. „The CO2 equivalent of Bitcoin is thus between 82 and 83 in the list of global emitters,“ explains Christian Stoll, one of the authors of the study. „Even if there are more important factors for climate change: The CO2 footprint is so large that it provides enough reason to discuss the regulation of crypto-mining at sites with CO2-intensive electricity production,“ Stoll said.

Stoll calls for mining facilities to be relocated, especially in areas where there is sufficient electricity from renewable sources. Another approach would be to replace proof-of-work in mining with another mechanism. The second major crypto currency, Ethereum, has taken up this cause, and the direct use of crypto money is intended to replace the work of the miners (proof-of-stake). But the introduction of the procedure has already been postponed several times. And in the Bitcoin scene this debate does not play a major role, probably also because it is contrary to the economic interests of the miners.