By CCN: Contrary to popular opinion, it appears that Bitcoin mining might not be as bad for the environment as people think. In a highly detailed report, CoinShares research reveals that 74% of mining activity runs on renewable energy.
“We show that Bitcoin mining is mainly located in global regions where there are ample supplies of renewable electricity available. And…we calculate a conservative estimate of the renewables penetration in the energy mix powering the Bitcoin mining network at 74.1%, making Bitcoin mining more renewables-driven than almost every other large-scale industry in the world.”
Bitcoin mining is primarily conducted in regions where there is ample access to renewable power. | Source: CoinShares Research
There is plenty of information out there which suggests quite the opposite of CoinShares’ findings. Far from being a progressive industry, some have even suggested that Bitcoin is worse for the environment than gold mining. Such a claim is a huge concern for those who hope that BTC is displacing the safe-haven gold market.
Digging deeper into the report, it becomes evident why Bitcoin’s electricity use might be as green as they claim. There is a clear trend among miners to opt for areas where hydroelectric power is abundant:
“Bitcoin miners are fairly well distributed across the globe…Looking more closely at their distribution, it is clear that they are predominantly — by volume weight — confined to technologically advanced, relatively sparsely populated, hilly or mountainous regions traversed by powerful rivers.”
While there are many regions fitting this mold, there are some large mining nations like Iran that don’t. A mix of wind, nuclear, and fossil fuel-powered electricity makes up the remaining sources of power for BTC creation.
However, due to the massive dominance of China in this field, we can see why hydroelectric power is the most critical factor. CoinShares outlines that Sichuan is steadily increasing its share of global Bitcoin mining:
“We currently estimate that 60% of global mining happens in China, and that Sichuan alone produces 50% of global hashrate…Our estimate for Sichuan’s dominance within both China and the world is marginally higher than in our last report and is a result of the ‘Fengshui’ rainy season in the hydro-heavy ‘Yunguichuan’…provinces of Southwestern China.”
While other anti-cryptocurrency reports have emerged, they often provide a blanket assessment of electricity usage. They do not pinpoint the exact sources around the world. Given that 60% of all Bitcoin mining runs predominantly on hydroelectric power, you could say the BTC network runs mostly on water. What could be greener than that?
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