Cambridge and IEA data shows bitcoin carbon intensity peaked last year

Worst case projections seem to suggest that bitcoin emissions will be down by more than two-thirds in five years.

According to publicly available data from the University of Cambridge Centre for Alternative Finance and the International Energy Agency, or IEA, bitcoin (BTC) carbon emission intensity may have already peaked.

The environmental impact of bitcoin’s electricity usage is a favorite talking point of its critics and journalists on the crypto beat. But taking in the available data, Hass McCook, a retired chartered professional engineer, reckons bitcoin’s carbon emissions “have already peaked a few months ago.”

McCook unpacked the data and defended that conclusion in a guest post on Bitcoin Magazine’s website Friday:

“From the above, it would appear that Bitcoin’s emissions peaked a few months ago, and thankfully, with the banning of Bitcoin mining in China, has commenced its aggressive march down to zero emissions. It is expected that in the worst case, emissions from Bitcoin in five years will be less than a third of its emissions today, and in 10 years, Bitcoin will emit nothing at all.”

BitAll’s bitcoin mining infrastructure was created over the last 12 years, giving miners the “second mover advantage” to avail their operations of the latest, most sustainable green tech for electricity to mine bitcoin.

Data from the Cambridge Bitcoin Electricity Consumption Index suggests that global bitcoin mining has a “grid intensity” (carbon emissions per unit of electricity consumed) that’s cleaner then the average of the entire global power grid. The world average is 463 grams of CO2 emitted per kilowatt hour. Bitcoin miners average 418 grams.

Meanwhile, world grid intensity peaked sometime last year, if the energy economy stays on track with projections for 2021 and subsequent years, according to data from the IEA. 

By design, computers running Bitcoin Core to validate and place new blocks on the bitcoin blockchain are required to use some electricity to correctly guess the input for a SHA-256 encrypted hash.

SHA-256 (short for Secure Hashing Algorithm) is a one-way hash function published by the U.S. National Security Agency in 2001, and an integral part of the bitcoin design architecture. Computers test the guess by entering it into the algorithm and seeing if it matches the hash on the previous block. The first node to guess the hash correctly gets to place the next block of transactions and award the bitcoin miner in newly-created bitcoin.

This proof-of-work, or PoW, mechanism qualifies nodes to participate on the network by forcing miners to venture electricity costs, and risk losing their operating costs for no profit if their computer attempts to cheat the network’s rules.

Some Bitcoin critics, and even proponents, say that its energy consumption poses environmental risks, and may contribute to human-caused global warming. Tesla CEO Elon Musk famously rattled bitcoin’s price this year by announcing the electric carmaker would accept BTC for Teslas, then backpedaling.

Musk said Tesla would begin accepting bitcoin again when 50% or more of miners’ energy usage is reasonably confirmed to be from “clean energy” sources.

McCook says most of the bitcoin emissions claims are overblown:

“One of the most widely debunked, yet still widely referenced claims of ‘academia’ is that Bitcoin will single-handedly increase the planet’s temperature by 2 degrees Celsius.”

A Bitcoin Mining Council survey report out this week estimates a 56% sustainable power mix for Q2 2021 in bitcoin mining operations globally based on respondents’ answers.

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Elon Musk tweets his support over proposed Dogecoin changes

Dogecoin got a price bump Monday out of another Elon Musk tweet, this time in support of a proposed update.

Elon Musk, the at-times controversial SpaceX founder and stop-and-go crypto supporter, voiced his support late Sunday for a set of major updates to the Dogecoin (DOGE) blockchain. The changes would drastically redesign the cryptocurrency’s software architecture and alter its token economics.

The popular “joke crypto” appears to be gearing up to become a serious utility coin after a massive influx of capitalization earlier this year. It remains to be seen whether the updates Musk supports would be good or bad for the coin’s holders should they be adopted.

In a Reddit thread Sunday, Dogecoin Core developer Patrick Lodder summarized the proposed updates:

“This proposal to all dogecoin stakeholders suggests to reduce average fees 100x for standard transactions on the dogecoin chain, split full control over all aspects of fees between miners and node operators, rely less on core development, and bring back a functional (small) free transaction space that incentivizes keeping the network healthy.”

Lower fees may attract more users looking to use Dogecoin for cash checking, remittances, and merchant payment settlements online. It may also lower the incentive for miners to maintain, validate, update, and secure the Doge blockchain.

Elon Musk told Dogecoin Core developer Ross Nicoll in a tweet Sunday night that these changes are, “Important to support.”

Charles Hoskinson — who cofounded Ethereum with Vitalik Buterin, and founded competing blockchain Cardano — said in a recent podcast that he’s just glad Musk is stirring the pot for Dogecoin, even when he’s just goofing on it.

Hoskinson said he hopes the attention will prompt “real developers” to come in and “start working on doge to create some use and utility for it, so at least it has a value floor and won’t collapse.”

Dogecoin got a price bump from Elon Musk’s tweet, rising from $0.242 (USD) to as high as $0.266 before settling in under key resistance around the $0.260 level at time of publication.

Musk’s ability to move markets with the tap of the tweet button led a former Bitrefill executive to joke, “Say something, Elon Musk!” last week with the DOGE price down for six consecutive weeks. That was after peaking in May along with the rest of the cryptocurrency market, though Dogecoin outshone most of its competition during the recent (and arguably ongoing) bull run.

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Elon Musk lays out when Tesla will begin accepting Bitcoin payments

Musk responded to a Cointelegraph tweet about Sygnia CEO Magda Wierzycka calling for the SEC to investigate him over alleged Bitcoin price manipulation.

Tesla CEO Elon Musk says his electric-vehicle company will start accepting Bitcoin (BTC) payments once there’s confirmation that miners are utilizing clean energy, offering a glimmer of hope that the FUD surrounding digital assets could soon subside. 

Musk responded to a Cointelegraph tweet about recent accusations from Sygnia CEO Magda Wierzycka, who called on the United States Securities and Exchange Commission to investigate the billionaire for allegedly manipulating Bitcoin’s price.

According to Wierzycka, Musk knowingly pumped the price of Bitcoin only to sell a “big part of his exposure at the peak.”

“This is inaccurate,” Musk said in a Sunday response. “Tesla only sold ~10% of holdings to confirm BTC could be liquidated easily without moving [the] market.”

As Cointelegraph reported, Musk acknowledged in April that Tesla had sold a portion of its Bitcoin holdings to prove the asset’s liquidity as an alternative to cash. Just one month earlier, the billionaire confirmed that Tesla added $1.5 billion worth of BTC to its balance sheet and would begin accepting the virtual asset as payment for its vehicles. 

However, Tesla’s embrace of Bitcoin-as-a-payment was short-lived after Musk flagged concerns over the cryptocurrency’s energy usage. On May 12, Musk tweeted that his company would no longer accept Bitcoin payments due to the network’s “increasingly rapid use of fossil fuels…”

Musk’s tweet coincided with a slew of negative headlines about Bitcoin’s energy usage, China’s intent to ban Bitcoin mining and an overextended crypto rally that was showing signs of weakness. The news cycle helped trigger one of Bitcoin’s most painful episodes, culminating in a 54% drop between mid-April and mid-May.

Related: ‘I have not sold any of my Bitcoin’: Elon Musk.

On Sunday, Musk laid the groundwork for when Tesla will once again accept Bitcoin payments:  

“When there’s confirmation of reasonable (~50%) clean energy usage by miners with positive future trend, Tesla will resume allowing Bitcoin transactions.”

As Cointelegraph reported, Musk was recently invited to a meeting of Bitcoin miners by MicroStrategy CEO Michael Saylor. The Bitcoin Mining Council, a voluntary, self-regulating industry body, emerged from the meeting with a mandate to exercise more renewable energy options and boost the transparency of cryptocurrency mining.

Despite all the criticism about Bitcoin mining, it’s estimated that a strong majority of miners already use alternative energy sources. Yassine Elmandjra, an analyst with Ark Investments, told CNBC in April that roughly three-quarters of miners use carbon-free sources in their operations.

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Crypto industry brass explains harnessing renewable energy could help BTC miners

Bitcoin mining via renewable energy is already prominent, one CEO explains.

The energy consumed by mining — the process that keeps Bitcoin’s blockchain running — has been an increasingly popular topic of discussion in recent weeks.

On Friday, CNBC posted an interview with SUKU CEO Yonathan Lapchik, during which he explained the Bitcoin mining scene as it relates to renewable energy. The interviewer noted Lapchik previously claimed that 75% of Bitcoin mining comes from renewable energy.

“We think that 75% is an actual figure,” Lapchik told CNBC, “The miners are truly incentivized to use renewable energy.” Turning his thoughts to electric car-maker Tesla, which recently announced it would no longer accept Bitcoin for purchases due to environmental concerns, Lapchik said “It’s surprising that Elon didn’t consider that before getting into the space, before accepting Bitcoin as a payment mechanism for Tesla.”

Tesla opened its doors to payments via Bitcoin by United States clientele back in March. The move went public following the car company’s purchase of $1.5 billion worth of BTC, announced in February.

Musk, however, recently stated disapproval of the fossil fuel energy Bitcoin mining calls on, via a Tweet on Wednesday. He also discontinued payments to Tesla in BTC, albeit seemingly a temporary move until Bitcoin mining reaches satisfactory energy usage levels.

“Really the data has been there forever,” Lapchik said of the 75% number. “We’ve been proving over and over and over that that’s a real case for miners in the Bitcoin network.”

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Green energy tokens capitalize on Tesla’s decision to nix Bitcoin payments

Tesla’s decision to cease Bitcoin payments ignited a green energy debate that sent the price of low energy consumption protocols like NANO, HBAR and EWT higher.

After months of touting the benefits of Bitcoin (BTC) and blockchain technology, Tesla CEO Elon Musk shocked the crypto Twitter on May 12 by announcing that the electric car company would suspend its accepting BTC as a form of payment, citing concerns related to the energy required to mine the top cryptocurrency. 

As Tesla issued its statement, Bitcoin, Ether and a large segment of altcoins sold off sharply but there were a few projects that found clever ways to capitalize off the mayhem by tweeting about the ‘green’ nature of their networks that require only a tiny fraction of the energy required to maintain the Bitcoin network.

HBAR/USDT vs. NANO/USDT vs. EWT/USDT 1-hour chart. Source: TradingView

Three of the biggest beneficiaries of the focus on energy consumption are Hedera Hashgraph (HBAR), Nano (NANO) and Energy Web Token (EWT). Each experienced double-digit gains on May 13, while a majority of the cryptocurrency market is in the red.

HBAR/USDT

Hedera Hashgraph is a public network that was designed to be a fairer, more efficient system that seeks to overcome some of the limitations of earlier-generation blockchain platforms that struggle with slow performance and instability.

The network received support from an unlikely source on May 13 as Deepak Chopra, a well-known spiritual teacher and meditation advocate, responded directly to Musk’s tweet about discontinuing Bitcoin payments by discussing the low energy nature of the HBAR.

Further exploration of the project’s Twitter feed show a litany of posts from various community members and project developers displaying the low energy cost of the Hedera network. This activity coincides with the May 13 spike in its price from a low of $0.226 to an intraday high of $0.41.

NANO/USDT

A second protocol that has jumped on the green energy wave initiated is Nano, a lightweight cryptocurrency designed to offer secure, near-instant payments with zero fees.

The project, along with members of its community, was quick to highlight Nano’s status as “one of the leading energy-efficient and eco-friendly cryptocurrencies of 2021” which may have helped propel the tokens price 121% on May 13 from a low of $8.00 to a 3-year high at $17.71.

NANO/USDT 4-hour chart. Source: TradingView

EWT/USDT

Energy Web Token is a more obvious beneficiary of the refocus on environmental concerns as it is the operational token behind Energy Web Chain, a blockchain protocol designed to facilitate application development for the energy sector.

While the project doesn’t focus specifically on payments, the protocol’s virtual machine has the potential to revolutionize the energy sector as it is oriented toward grid operators, software developers and vendors.

The project responded to the recent announcement from Musk with the following tweet touting the protocol’s ability to decarbonize the global energy sector.

EWT rallied 75% from a low of $13 late on May 12 to an intraday high at $22 before profit-taking pushed the price back below $18.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

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