Bitcoin mining is notorious for its massive energy energy requirement which climate groups believe can be reduced by changing the code.
A campaign launched on Tuesday calls on Bitcoin miners to make a small change to the way it’s mined to tackle its enormous carbon footprint.
The campaign called ‘Change the Code Not the Climate’ is coordinated by Environmental Working Group, Greenpeace USA and several groups battling bitcoin mining facilities in their communities as reported by The Guardian.
Unlike traditional finance, cryptocurrency networks use a ‘consensus mechanism’ which allows all the computers in a crypto network to agree about which transactions are legitimate.Â
Bitcoin works on a mechanism called ‘Proof of work’ where miners around the world race to solve a math puzzle needed to add to the Bitcoin ledger. Naturally this requires a huge amount of processing power.
An alternative to this is a ‘proof of stake’ mechanism, now used by cryptocurrencies like Ethereum, which requires 99% lesser energy. Here, miners pledge their coins to verify transactions and adding inaccurate information leads to penalties.
With the value and use of cryptocurrencies rising, the campaign’s organisers argue bitcoin must switch to ‘proof of stake’ or find another, less energy intensive, method.Â
‘This is a big problem. In part because of where the industry stands now but also because of our concerns about its growth,’ Michael Brune, campaign director and former executive director of Sierra Club, told The Guardian.
Bitcoin is also resurrecting fossil fuels as ‘miners’ have started buying US coal plants. Bitcoin mining operations are also being run using fracked gas and flare gas.
Switching to a low-energy protocol has proven effective and uses a fraction of the energy. While other cryptocurrencies like Ethereum are changing their code Bitcoin is still not.
The US now leads the world in cryptocurrency mining after China launched a crackdown on mining and trading last May.
‘Coal plants which were dormant or slated to be closed are now being revived and solely dedicated to bitcoin mining. Gas plants, which in many cases were increasingly economically uncompetitive, are also now being dedicated to bitcoin mining. We are seeing this all across the country,’ said Brune.
‘There’s no way we can reach our climate goals if we are reviving fossil fuel plants,’ he added.
Some bitcoin miners have recently begun powering their operations using renewable energy from wind and solar energy but Brune said it’s not enough.Â
‘Fossil fuel growth is outpacing renewable growth in bitcoin mining and that’s the fundamental challenge,’ he said.
Climate activists point out the basic problem with Bitcoin’s code which ‘incentivises maximum energy use’.
‘The minute that there is the opportunity to go to something dirty, which is what you are seeing, that is going to happen,’ said Chris Larsen, founder and executive chairman of crypto company Ripple and a climate activist.
He described a ‘nightmare scenario’ where the world does get to a renewable future in China, the US and EU but countries rich in fossil fuel switch to bitcoin mining to keep their operations running.
‘Imagine the Saudis sitting on all that oil, which has a cost of about ½ cent per kilowatt hour – no renewable can match that,’ said Larsen. ‘Bitcoin mining could be this endless monetization engine for fossil fuels,’
The campaign is launching with digital advertising in the Wall Street Journal, New York Times, Marketwatch, Politico, Facebook and other publications.Â
The organisers are also taking legal action against proposed mining sites and using their large memberships to push bitcoin’s biggest investors and influencers to call for a code change.Â
A report in the journal Nature Climate Change found that if Bitcoin becomes widely adopted, it could produce enough carbon dioxide emissions to warm the planet above 2 degrees Celsius.
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