A new paper published in scientific journal Nature titled ‘Bitcoin emissions alone could push global warming above 2 °C’ appears to be filled with inaccuracies that misdirect this dire prediction.
The Paris Agreement was signed by 176 countries and is designed to mitigate greenhouse gas emissions so anthropogenic global warming does not exceed 2 °C, which some scientists say would be catastrophic. The paper states that drought, wildfires, storms, heatwaves, floods and sea level rise will become more common if the 2 °C threshold is breached. Sea levels will certainly rise in such a scenario due to melting polar ice caps, and heatwaves will become more common since the planet will become warmer.
As for the other catastrophes like drought, floods, and storms, they will shift locations as the climate changes due to changes in large-scale atmospheric circulation patterns, but not necessarily increase on average. Places that are not used to floods might start getting floods, while places plagued with floods might be relieved of their flooding problems, for example.
From 1860 to 2014. 584.4 gigatons of carbon dioxide (GtC) was released by human activity, mostly from the burning of fossil fuels. There has been 0.9 °C of global warming during the same period of time. Greenhouse gases like carbon dioxide block longwave infrared radiation from going out to space, reflecting it back to the Earth, which warms the planet. However, it is important to note that not all of the temperature increase can be blamed on greenhouse gas emissions, since changes in solar heating and other non-linear systems in the ocean and atmosphere play essential roles in climate change.
The paper estimates that it will take 231.4 to 744.8 GtC being released to reach the 2 °C anthropogenic global warming threshold, and this range seems to appropriately account for non-linear systems in the ocean and atmosphere, whose effects on the climate are difficult to predict when aggregated.
Digiconomist, a popular site for tracking Bitcoin mining energy consumption, is referenced in the paper. Digiconomist assumes that 60% of mining revenue is spent on operational costs, and with the assumption of USD 0.05 per KWh, and 0.7 kg of CO2 released per KWh, this yields an emission of 33.5 megatons of CO2 (MtCO2) annually.
A study in June 2018 found that the real energy consumption of Bitcoin mining was half of what Digiconomist says. The study calculated the energy consumption based on the spectrum of Bitcoin mining rig hardware, rather than the overly simplistic calculation that Digiconomist utilizes. Further, the study found that Bitcoin mining is fueled primarily by renewable energy like hydroelectric and geothermal power, since electricity rates are much cheaper near major sources of renewable energy. Therefore, greenhouse gas emissions are possibly less than half of those calculated by Digiconomist.
The paper being discussed in this article used their own methods to calculate Bitcoin mining greenhouse gas emissions and somehow came up with 69 MtCO2 per year. This is more than double the Digiconomist estimate.
The paper then uses an average of dishwashers, electricity, and credit cards to estimate how fast Bitcoin will proliferate globally. There are 314.2 billion cashless transactions per year according to the paper, of which Bitcoin represents 0.033%. The paper extrapolates that Bitcoin will represent all of these cashless transactions in less than 100 years.
Doing the math, for Bitcoin to achieve 314.2 billion transactions per year there would have to be 6 million transactions per block. Some totally full blocks that are 1.2 MB have 3,000 transactions. Thus, the block size would have to be 2.4 GB in the future according to this paper’s calculations, assuming 3,000 transactions is equal to 1.2 mb. This would be completely unsustainable for the Bitcoin network, and would not happen. Second layer solutions like Lightning Network, which use practically no electricity, would be implemented before block sizes are increased beyond the current 1.2 MB approximate limit.
The end results of this paper’s calculations show Bitcoin mining cumulatively releasing 500+ GtC by 2040, equivalent to all of humanity’s CO2 emissions since 1860. By 2060, the projection shows 1,000+ GtC being released by Bitcoin mining.
Summing up the inaccuracies in the paper: scalability is mishandled, since second layer solutions like Lightning Network will be used instead of increasing block size to allow more on-chain transactions. A significant fraction of Bitcoin mining is powered by renewable energy, which barely releases greenhouse gases relative to fossil fuels; the paper does not account for renewable energy at all. The estimates of Bitcoin’s energy consumption are double that of Digiconomist, and the latter has been scrutinized for overestimating by about 100%.
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