Crypto Miners’ Green Efforts Fall Short
Bitcoin Miners’ Emissions Problem
Bitcoin mining requires a lot of electricity, and has a bad reputation when it comes to the industry’s environmental impact. Miners have been working to change that, but so far these efforts have yielded disappointing results.
To become more environmentally friendly, cryptocurrency miners are powering their computers with green energy or are working with data centers powered by solar or wind. The declining prices for renewable energy and rising prices for Bitcoin (BTC) make using renewable energy a realistic option. Nonetheless, the majority of Bitcoin miners rely on fossil fuels to power their operations, raising the ire of investors and prompting some miners to make more of an effort to reduce their carbon footprint.
Regulation Coming Down the Pike
Because of crypto mining’s negative environmental impact, miners have created what is known as the Crypto Climate Accord, a framework calling on cryptocurrency companies to achieve net zero emissions from electricity by 2030. About 180 companies have vowed to meet that target. Cryptocurrency exchange Coinbase (COIN) is focusing on its environmental impact and plans to announce actions to address climate change in the coming weeks.
Meanwhile, lawmakers in New York State are working on a bill that would prohibit the use of fossil fuels to mine for Bitcoin. Legislators are also calling for miners to show how they are lowering their carbon footprints. The Securities and Exchange Commission is also considering rules requiring public companies to disclose data about their environmental impact.
Some Miners Have Achieved Net-Zero Emissions
Gryphon Digital Mining and some other crypto miners have already reached net-zero emissions. Gryphon Digital quickly hit this benchmark with a 21-megawatt facility that uses hydroelectric power. Gryphon also switched to a hosting company which uses renewable energy for over half its power. Of the firms mining cryptocurrency, 76% combine renewable energy and fossil fuels to power their mining operations. Still, under 40% of the total energy used to mine for crypto comes from green energy.
Bitcoin miners have an emissions problem. However, fossil fuel is still the cheapest source of energy and this isn’t likely to change in the near future. It will be interesting to see how crypto companies react to increased pressure from investors and climate activists.
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