Cryptocurrencies need a Captain Planet
The 1980s American cartoon, Captain Planet, featured a superhero who could harness the elements of nature to help fight against the world’s greatest ecological sinners. Wind, water, fire and earth were impersonal powers which would sweep away villains who harmed the earth by unsustainably over-using resources. Captain Planet would show up to teach everyone a lesson: the planet is our mother and we need to treat her well.
There are justified hype and hopes surrounding the emergence of cryptocurrencies. These can indeed democratize transactions and record-keeping. But this technology has a darker, lesser known side which is causing a debate about the sustainability of this revolutionary development. The computer power needed to create a single digital coin consumes at least as much electricity as the average American household burns through in two years.
Coin mining – the process of unleashing coins onto the blockchain – has become a major business. The earliest of cryptocurrencies, bitcoin, has the capacity to hold 21 million coins on the blockchain. Over three quarters have been mined already, but to add the remaining coins, the computing capacity gets more and more complex. According to the bitcoin energy consumption index, this cryptocurrency already consumes 0.15% of the world’s energy, and far exceeds the electricity consumption of Ireland or of most African nations. Some single crypto-mining sites consume as much power in a day as one of these nations.
Vitalik Buterin, founder of Ethereum, has expressed his concern about the climate impact of the network he himself pioneered. “I would personally feel very unhappy if my main contribution to the world was adding Cyprus’s worth of electricity consumption to global warming,” he said in an interview with the New York Times.
Several initiatives are rising to use renewable energy to power crypto-mining computers. There are already bitcoin mines set up at the edge of the Arctic Circle. The geography and climate provide natural cooling for computer servers and geothermic energy for power. Mountainous regions are already beginning to see crypto-mines using hydropower. There is need for responsible thinking and action.
This is the just the beginning of a necessary development. Crypto-miners must realize the impact they will have not only on society, but also on the environment. It is imperative that we use renewable energy sources to supply the consumption needs of the growing blockchain ecosystem. Or else Captain Planet may have to pay us a visit.