Climate paper says Bitcoin mining is putting vulnerable nations at risk

The number of people dabbling in Bitcoin is around the same population as the city of Jakarta and less than 1 percent of the planet. ‘If we were all using this technology, then perhaps you could justify such a massive carbon footprint,’ he says.

Comparing crypto to other modern financial systems, he likened the situation to a ‘steam engine when we have Teslas.’ Ironic, given the company’s chief is something of a cult leader for Doge buffs.

Lamenting what they describe as ‘crypto colonialism,’ the pair suggest that every dollar Bitcoin generates would need to be offset by $0.49 to get anywhere close to remedying public health issues linked to the climate.

Speaking also on the socio-economic aspect, they revealed that nefarious groups of crypto miners directly lean towards conflict areas to hoard already scarce financial resources. ‘We can think of these in the same way as we think of conflict diamonds,’ said Peter.

Given that financing for developing nations played such a key part in COP26 negotiations, crypto analysts and environmentalists are demanding that policymakers coordinate to clean up the sector.

China recently made cryptocurrency transactions illegal as part of its clean energy goals, but mining has since shifted to the neighbouring country of Kazakhstan. Wanting to avoid a similar outcome across other regions when they inevitably address the issue, the paper calls for a global ban to ‘proof of work’ systems.

This means that dedicated supercomputers running crypto blockchains would be turned off and some form of third-party agency would likely come into place. ‘Proof of stake’ is regularly offered up as a strong alternative, as it uses equity stakes to create blocks on a blockchain and not constantly running algorithms.

The likes of Sweden and Norway have been looking to axe ‘proof of work’ for some time, but experts are calling for wider unity under the umbrella of our 1.5C goal.

‘Having reviewed all of the different policy options, a global coordinated ban on proof of work cryptocurrency is really the only means by which we can rein it [both economic and climate damage] in on a decent sort of timescale.’