Iran Energy News Oil, Gas, Petrochemical and Energy Field Specialized Channel
Related Articles
Since the inception of Bitcoin to the financial landscape and its underlying Blockchain technology, there has been a lot of controversy surrounding the industry. Voices from environmental activists raising their concerns over the effects of the new assets on the environment have often controlled the narrative around the subject.
However, a recent study by the Institute of Risk Management illustrates a new, unprecedented side to this technology. In its recent paper, ”Bitcoin and the Energy Transition: From Risk to Opportunity,” the institute stated that Bitcoin could potentially speed up global energy transition.
The publication added that even as BTC is seen as a risk to the environment, it could also speed up energy transition and cause the development of new solutions to solve global energy challenges. This study is a clear shift from BTC to the other side of the climate change debate.
Bitcoin shifts sides on the climate change debate
The paper highlighted the importance of clean, affordable, and reliable energy sources. BTC is largely criticized for its high energy consumption during mining and its carbon emissions. The paper highlighted the potential benefits the digital asset could have for the energy industry.
For instance, BTC could significantly reduce global emissions by turning harmful methane emissions into more useful raw materials. This can be done by capturing the methane gas and converting it as a source of energy to power computers in BTC mining, thus reducing the emissions released into the atmosphere by 8% by 2030.
The authors also presented their findings on what other benefits BTC could have on the environment. One other theoretical approach is Bitcoin contributing to efficient electricity grid management by transferring heat emitted by the computers during mining to greenhouses to create a suitable environment for growing crops and horticultural products in areas with less favorable temperatures.
They also noted that as much as BTC is a high-energy consumer, it does not emit carbon dioxide and other pollutants, which shows that Bitcoin may expedite the achievement of a cleaner and healthier atmosphere in the future.
The paper illustrated that BTC has the potential to accomplish its environmental, Social, and Governance(ESG) roles by using wasted energy resources such as Methane gas, aiding power grid stability, and promoting renewable sources of energy. This paper confirms Blomberg Intelligence and Cambridge University’s research, illustrating that BTC’s environmental impact is vastly exaggerated.
Bitcoin Emissions Reduce as Adoption Increases
Bitcoin critics still deny the asset’s impact on the energy systems; for instance, miners use the cheapest electricity they can find, paying an average of $0.2/kWh. According to Coingecko, the cost required to mine on Bitcoin as of now stands at $46,291, which, when compared to common household appliances such as an air conditioner or a drier, all consume more electricity than the amount used in mining one BTC.
These numbers are expected to drop in the near future as BTC mining becomes more profitable on nearly free energy costs; this, in return, will have a positive impact on the environment. The push to acquire cheap energy sources is playing a role in the network’s rising hash rate while reducing the carbon emissions rate.
Bitcoin emissions have been trending down, which is more than most industries can report. Even as BTC adoption increases, the same does not translate to the carbon footprint. According to Jamie Coutts, Blomberg market analyst, Bitcoin has continued to exhibit signs of sustainable energy even with the network’s expansion.
He added that the relationship between Bitcoin adoption and the global transition to green energy could catalyze a new wave of institutional and sovereign investment capital. Bitcoin miners are also focused on more sustainable alternative energy sources to boost the industry’s efficiency.
The new study has illustrated a new side of BTC’s contribution to climate change. The study states that Bitcoin could just be the strongest lever needed to slow down climate change. Bitcoin emissions are already considerably lower even as adoption increases, showing that the assets are well suited to sustainable energy consumption.
BTC could also clean the environment by turning harmful waste into raw materials for energy production that can be utilized in other areas, such as farming and water treatment facilities.
