Misleading attacks on bitcoin mining energy use are intensifying, and investors need to be aware of the adversaries that they face.
This is an opinion editorial by Zack Voell, a bitcoin mining and markets researcher.
For most of Bitcoin’s short history, discussions over how much energy the global network uses to process and record transactions has been a recurring talking point. But today, the conversation is reaching new levels of intensity as credentialed adversaries posturing as being environmentally conscious pile on to attack Bitcoin in the public arena.
These attacks extend beyond subtle investment preferences, like hedge funds allocating to coins or tokens that advertise “green” or “clean” infrastructure. And they can be even more direct than the World Economic Forum tweeting about Ethereum’s merge.
This article overviews several lengthy attacks on bitcoin mining’s energy use from just the past month, and it advocates for bitcoin investors to educate themselves and act against these misinformed yet influential environmental attacks.
The White House Weighs In On Mining
One of the most prominent documented criticisms of bitcoin mining comes from the 46-page report published by the White House last month on the supposed negative environmental externalities caused by bitcoin. A detailed, annotated version of the report was published by crypto venture capitalist Nic Carter. And even though the report is full of errors and misrepresentations, as Carter pointed out, it’s important to note that the underlying ideas it represents are the dominant view in Washington political circles, as the Bitcoin Policy Institute noted on Twitter.
The amount of energy consumed by miners is criticized for potentially undermining U.S. sustainability goals, noting the landmark example of China’s mining ban, which was allegedly because of “the incompatibility of large-scale Bitcoin mining with the country’s environmental goals,” according to the report. The report also calls for the Environmental Protection Agency and Department of Energy to work with state and local officials to build standards for the mining industry.
“Should these measures prove ineffective at reducing impacts, the Administration should explore executive actions, and Congress might consider legislation, to limit or eliminate the use of high energy intensity consensus mechanisms for crypto-asset mining,” the report said.
Academics Pile On Mining Criticism
Academics from across the U.S. wanted to have their say in the discourse about bitcoin and climate change last month as well. Two separate studies examined bitcoin mining’s energy use and estimated emissions to understand if and how it affects the environment.
From Cornell Engineering, a new study from faculty on accomplishing carbon neutral bitcoin mining that was published in the September issue of the journal Energy & Environmental Science. The study suggests that states with low prices and large amounts of renewable energy in their power mix could help to mitigate “the environmental damage that cryptocurrency brings.” Like many other reports, this one starts with the one-line, quasi-prejudiced assertion: “Bitcoin mining requires a significant amount of electricity to validate blocks, increasing greenhouse gas emissions.”
There is no room for nuance.
From the University of New Mexico Economics, three professors wrote a paper that “estimates of the energy-related climate damages of mining bitcoin.” Again, because it consumes energy, it must be bad. The paper also measures peculiar metrics like climate damage per coin mined. Ultimately, they make bizarre conclusions like that bitcoin contributes roughly equivalent environmental damage as all beef, and internet money is “more like digital oil than digital gold” in a rhetorical slight against both bitcoin and fossil fuels. Tidbits of this study headlined in almost every major news publication that has ever written about bitcoin, including Bloomberg, The Verge, Time, Newsweek, The Hill, Forbes, The Daily Beast and many more. It even reached the Smithsonian Magazine. In short, this bit of pop science was a hit.
Activists Also Slam Bitcoin Mining
Earthjustice and Sierra Club, two prominent environmental activist organizations, also piled on the latest wave of public ridicule for bitcoin mining. The organizations collaborated on a 37-page report on the environmental impacts of bitcoin mining titled “The Energy Bomb” and claiming to “break down nebulous and opaque industry and false claims to sustainability.”
For example, the report sounds the alarm on the fact that the “mining industry already uses half the electricity of the entire global banking sector, and it will overtake the sector in two years if current trends continue.” The horror! (Just cancel banking instead.) The report also claims “bitcoin emissions” rival those of driving six million cars. These talking points were echoed in mainstream media outlets from The Verge to the Financial Times.
What Can Bitcoin Advocates Do?
Frustration or demoralization are both unsurprising reactions to this onslaught of half-truths, prejudiced criticism and consistent attacks on bitcoin mining. And it is notable that all of these reports, articles, studies, etc. are from the past month. So, the fight is far from over.
One of the most important steps for bitcoin advocates to take today is self-education on electric markets and energy. “What Bitcoin Did” has recorded numerous episodes dedicated to this topic. Braiins Mining has published an in-depth series on mining and energy grids. And this topic is discussed daily on Twitter. Bitcoin investors should exploit all of these educational resources.
Another step is to simply start mining. With $100 and a few hours of reading, anyone can start mining at home. Not only is this an educational exercise to learn the mechanics of mining, but it adds more activist-proof hash rate to support the network.
Even though daily mining revenues have dropped substantially, the educational value of mining remains constant. And at-home hash rate is more secure in many ways than corporate mining. Home miners are Bitcoin’s miners of last resort — the network’s backbone. If everything else falls apart from climate hysteria or onerous regulations, home miners will still be hashing (and possibly heating homes or greenhouses with the exhaust air).
Bitcoin will win. But its triumph will not come from inaction.
This is a guest post by Zack Voell. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.