Cryptocurrencies also harm the environment, at least indirectly. In fact, according to a recent study by economists Alex de Vries and Christian Stoll of the Dutch central bank and MIT, every bitcoin transaction is equal in generating the same amount of electronic waste as throwing two iPhones into the trash.
Until now, it had been noticed that these mining tasks – creating a unit of the cryptocurrency in exchange for keeping it – consumed a lot of energy resources. However, a study by Galaxy Digital, published during the first months of 2021, defended that the expense was not so bad, pointing out that bitcoin mining used only half the energy that the traditional banking system consumes.
The footprint of cryptocurrencies
In this sense, De Vries and Stoll assure that the harmful effects of cryptocurrencies on the planet that are of greatest concern are those that have a direct impact on the environment.
The study points out that in 2020 alone, 112.5 million bitcoin transactions were carried out and each of them produced 272 g of electronic waste. That is, the weight of two iPhone 12 Mini.
The bitcoin, in total, would generate 30.7 kilotonnes of waste annually. This figure is comparable to the amount of electronic waste that the Netherlands can produce. This is because the computers used to mine cryptocurrencies have a very short lifespan. Therefore, each transaction is a death blow to these types of computers, which are only used for this purpose.
Traditional banking also pollutes
Experts predict that this environmental problem with bitcoins will increase over time if its price, which is variable, continues to rise. It makes sense, because the more value of the cryptocurrency, the more it will be mined and the more computers will be used.
The solution to cut the impact of bitcoin mining on the environment is to redo the mining process again and create a more sustainable alternative: the proof of stake, to which Ethereum will be changed.
The same study also recalls that electronic waste does not come only from cryptocurrencies since the lifelong financial system also generates waste in the form of ATMs, computers, credit cards and other devices that are used on a daily basis.