Coin Metrics Co-Founder, Nic Carter has brought a well-researched refutation to some of the key claims that suggest that Bitcoin mining is causing an environmental disaster. Carter contends that Bitcoin mining is majorly concentrated in areas where there is an excess of energy.
Nic Carter Takes Aim at Environmental Concerns
Coming to the first claim Carter took aim at was that Bitcoin is unique among assets. A rising price entails a greater energy draw towards the first digital coin. Carter stated that “gold has the exact same trait in that higher prices result in increased mining and energy consumption.”
Secondly, it was claimed by Smith that Bitcoin mining hogs local power resources, which deprive regular customers of electricity. Carter produced some figures that show that mining is mainly concentrated in the areas where there is actually an excess of unused energy.
Within China, the vast majority of mining occurs in four provinces only. Xinjiang, Sichuan, Inner Mongolia, and Yunnan prove to be the most concentrated places of mining. Between these four provinces, they account for 63% of the global Bitcoin hashrate from Q4 2019 to Q2 2020.
The main reason for selecting these four areas is that they are using a combination of coal, solar, wind, and hydropower. Which will have a relatively low population density and an overabundance of energy.
Bitcoin Mining Estimated Consumption of Energy
According to the statistics from the Digiconomist and Cambridge University. Bitcoin mining has been estimated to consume between 89 TWh/year and 138 TWh. Suffice to say, there’s enough nonviral energy out there to run Bitcoin many times over. It’s just a matter of deploying hashrate in the right locations, which miners are doing — aggressively.
If Bitcoin mining, which is relatively portable, is concentrated in areas where electricity is unused and therefore is comparatively cheap. For example, Alex de Vries, founder of Digiconomist, mentioned in a recent article:
“The record-breaking surge in Bitcoin price at the start of 2021 may result in the network consuming as much energy as all data centers globally, with an associated carbon footprint matching London’s footprint size.”
Carter doesn’t believe that Proof of Stake can compete in terms of security and decentralization. However,
“This is a cornerstone of the anti-Bitcoin energy argument: the notion that you can have something for nothing with Proof of Stake. No energy consumption, yet still a functioning decentralized consensus. If this logic reminds you of perpetual motion machines, it’s because that’s exactly what is being proposed here: a completely free lunch where you get precisely the same assurances as Bitcoin with no costs whatsoever.”