From the day of the launch of cryptocurrency, it has been under the scanner for damaging the environment and promoting illegal activities.
However, it appears that the effect of cryptocurrency on the environment is not that much as always discussed.
Are Traditional Banks Innocent
There always have been acquisitions that Bitcoin is wasting a lot of resources in the mining process. Even Tesla CEO, Elon Musk, declared that they will not accept Bitcoin as a form of payment because of the Bitcoin network’s high energy consumption.
This entirely is not true, the traditional banking system appears to be consuming more energy. As per the data provided by the crypto investing firm, the Bitcoin network consumes about 113.89 Watts per hour, and The University of Cambridge Center for Alternative Finance consumes about 128 Watts per hour, which is more than what is used by the entire Bitcoin network.
The data also shares that the energy consumed by the entire crypto network is half of what is utilized by the traditional banking system globally.
Crypto: The Scapegoat
An increase in the popularity and prices of cryptocurrency have brought it under huge scrutiny. With cryptocurrency challenging the current mainstream financial system, the working of cryptocurrency, and how it consumes energy has always come under scrutiny. In the case of the mainstream financial system, attention is mainly over malpractices or fraud, and its energy consumption is completely ignored.
With most of the organizations trying to be energy efficient and achieve carbon neutrality, Bitcoin is scrutinized for not taking similar initiatives. Technically speaking, this couldn’t be achieved by anyone. Carbon neutrality is to remove as much Co2 from the environment as much is being emitted. But this is not possible, even for renewable energy generating machines like windmills and solar panels, as they also are not completely carbon neutral. Carbon neutrality can be only reached when all the processes are stopped.
With more and more proof surfacing every day about Bitcoin being not as hazardous as was thought to be, it will face less scrutiny in the future. Also, many cryptocurrencies are working hard to become more energy efficient.
To achieve this Ethereum is planning to launch a new upgrade, which will ensure less consumption of energy. In Bitcoin, a committee has been set up to identify methods that will ensure efficient usage of energy on the Bitcoin network.
While there is still a long way to go for cryptocurrency in becoming fully energy-efficient, it is clear that all the misconceptions surrounding cryptocurrency are being dismissed.
Disclaimer: The article is just to provide information and shouldn’t be considered as any financial advice. It is advisable to conduct thorough research before investing in any cryptocurrency.
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