Could cryptocurrency mining soon be banned from the United States? This is indeed what a report from the Office of Science and Technology Policy of the White House published yesterday suggests, in which there is a vitriolic criticism of the mining of Proof-of-Work (PoW) cryptocurrencies, such as Bitcoin.
The report actually considers cryptocurrency mining operations to be a major obstacle to the fight against climate change. It also says that federal agencies should consider information provided by cryptocurrency miners and local utilities “in a privacy-preserving manner” to help understand and mitigate their impact on the environment.
The figures are indeed striking: crypto mining activity in the United States now consumes as much energy as the entire US computer park, or the entire residential lighting, according to the report. Note that these conclusions are in addition to an accumulation of criticism regarding the electricity consumption of bitcoin mining, in the context of a global energy crisis.
Reminders of PoW and PoS crypto mining and power consumption
For neophytes, it should be remembered that crypto mining involves the enormous use of computer computing power, often with graphics cards used in video games, or specialized, to solve the mathematical equations necessary to validate and secure transactions. This process consumes a tremendous amount of electricity.
Cryptocurrency miners get rewards from modern cryptocurrencies. Therefore, crypto mining is also at the root of the increase in the supply of cryptocurrencies based on the PoW system.
Bitcoin, the world’s largest cryptocurrency by market capitalization, relies on this “proof of work” system. Ethereum, the second most important digital currency on the market, is also based on a PoW system, but it will switch to a “Proof of Stake” (PoS) system during September, at the end of the transition process that started. many months ago.
This PoS system is completely different from the PoW system from a technical point of view, and it can reduce the energy consumption of cryptocurrency networks by up to 99% compared to PoW networks. To learn more about how PoS systems work, we invite you to read about staking.
Crypto mining is hindering the fight against climate change, the White House says
Going back to the report released by the White House yesterday, note that it states that crypto mining in the United States is responsible for 0.2% to 0.3% of global greenhouse gas emissions, and 0.4% to 0.8 % of national emissions.
This means that since the beginning of the year, cryptocurrency mining in the United States has generated between 110 and 170 million metric tons of carbon worldwide, and about 25 to 50 million metric tons in the United States.
It is important to note, however, that the report does not provide much detail on the methods used to arrive at the data presented. It should be noted in particular that cryptocurrency miners obtain electricity by purchasing it from the electricity grid. Therefore, the level of pollution of crypto mining also depends on the way the energy is produced, knowing that some regions of the United States produce a lot of clean energy, and others less.
Moreover, when cryptocurrency mining companies decide to produce the energy they consume themselves, they often use renewable and clean energy.
It is true that this point is taken into account in the report, recommending that the government learn more about the composition of the sector’s energy consumption, promote energy efficiency standards and promote “the use of environmentally friendly crypto-asset technologies”. , but this is only a brief excerpt.
The White House is threatening to ban Bitcoin mining
However, the White House report asserts that “the use of electricity from digital assets contributes to GHG emissions, additional pollution, noise and other local impacts, depending on markets, policies and local sources of electricity”.
The report thus alleges that “depending on the energy intensity of the technology used, crypto-assets could hinder broader efforts to achieve net-zero carbon pollution, consistent with US climate commitments and goals.” .
In light of these findings, the White House has gone so far as to warn that if cryptocurrency mining fails to become greener, it could be banned altogether, at least in the case of Crypto PoWs like Bitcoin.
“If these measures are not effective in reducing impacts, the administration should explore executive actions, and Congress may consider legislation, to limit the use of energy-intensive consent mechanisms for mining crypts or their elimination.
Do you doubt Bitcoin’s future because of its energy-intensive PoW system? Find out how to buy Ethereum, which will soon switch to the PoS system!