Crypto and Climate Change: Can We Square the Circle?

Welcome to the world of Web 3.0 💚!!

where the limits of what is feasible are being stretched farther than they have ever been. Some view it as the next frontier of technological progress, while others regard it as a dystopian society full of scammers, fraudsters, and hackers.

However, the possible influence of Web 3.0 and cryptocurrencies on climate change is one of the main worries regarding their effects on our world. Global energy usage has significantly increased as a result of Web 3.0 and bitcoin. According to estimates, the yearly power usage of Finland or Sweden is equal to 0.55% of the total electricity consumed globally, which is Bitcoin alone. According to projections, the blockchain network's energy usage may surpass that of Denmark as a whole by 2025, making this worrying statistic even more concerning.

So, do cryptocurrencies and Web 3.0 pose a threat or a solution to climate change? Let's examine this query in more detail. The challenges and potential solutions to climate change posed by Web 3.0 and cryptocurrencies will be discussed in this essay. We will examine how mining cryptocurrencies affects the environment, how Web 3.0 may help with sustainable activities, and how virtual reality technology can be used to forecast and carry out climate change plans.

The cryptocurrency mining industry's carbon footprint

Currently, especially in the cryptocurrency space, it seems unrealistic to be excited about Web 3.0 applications and sustainability at the same time. It's worthwhile to give it a shot and learn more about the various levers by doing some research.

Verifying transactions on a blockchain network is known as crypto mining. This process uses a lot of energy, and fossil fuels are frequently utilized to create the electricity needed to run mining operations. There are already almost 10,000 different cryptocurrencies in use, and since cryptocurrency mining has a carbon footprint that contributes to climate change, consumers and environmentalists are becoming increasingly concerned about it. According to estimates, the energy used for cryptocurrency mining releases between 22 and 22.9 million metric tons of CO2 annually.

According to Bill Gates, this is "not a great climate thing" from April of last year. One may even characterize it as a severe climatic issue. The players in space need to be put under pressure to develop answers since mining has a massive negative influence on the environment. If we ignore all of these detrimental externalities, we will soon encounter a layer of expenses and unmatched difficulties as a result of a series of problems.

The fact that a large portion of cryptocurrency activity takes place in nations with lax environmental restrictions, which keeps mining prices cheap, is another unspoken problem. For instance, until the government decided to impose a ban, China accounted for over 75% of the world's Bitcoin mining activity. As a result, the country's mining share fell to 22%. This is important since addressing the sustainability challenges in cryptocurrency requires an awareness of them. Acting now will eventually reduce unforeseen expenses and save the sector some cash.

In a nutshell

• Although the bitcoin industry offers many advantages and prospects, it also has significant, often-overlooked environmental effects.
• The most well-known cryptocurrency, Bitcoin, has unsettling effects for the land, water, and climate.
• The amount of energy used to mine bitcoins and their price are closely connected.
• The price of Bitcoin increased 400% between 2021 and 2022, which led to a 140% rise in the energy used by the global Bitcoin mining network.
• China ranked first in the world in 2020–2021 for mining Bitcoin, with the United States, Kazakhstan, Russia, Malaysia, Canada, Germany, Iran, Ireland, and Singapore following in order.