Bitcoin and other cryptocurrencies experienced their most successful year in 2020. U.S. investors earned billions from the currencies, defining the future of their market success. Many consumers responded to financial statistics by blindly investing.
When individuals buy into cryptocurrencies, they begin supporting an environmentally degrading industry, expanding their carbon footprints. Unlike the paper dollar, crypto is a digital exchange and requires computing power to exist. A global market that relies on electricity increases atmospheric degradation, minimizing the industry’s sustainability.
Current Challenges in the Crypto Sector
A significant sustainability challenge in the cryptocurrency sector derives from energy use. Developers must constantly generate new coins to meet consumer demands using a computerized mining process. Mining for Bitcoin alone consumes 0.55% of the global energy supply, which is equal to Sweden’s power consumption rate.
China has the highest crypto mining rates, expanding past 66% in 2020. The country sources most of its energy from coal, creating high quantities of greenhouse gas emissions. The emissions raise Earth’s temperature over time and create a ripple effect of environmental degradation.
Another concern in the crypto realm is the regulations surrounding decentralized currencies. Individuals can notice the consistent fluctuation in a coin’s value, minimizing its stability. Investors may evaluate the risk associated with investing when developing their monthly reports.
Cryptocurrencies also create a significant ecological risk by expanding electronic waste (e-waste) challenges. Mining and maintaining coins use a vast quantity of computing power. When computers inevitably burn out or crash, they contribute to the 50 million tons of global e-waste.
Computer parts contain lead, mercury, cadmium, beryllium and more, damaging local ecosystems. Some countries allow workers to disassemble the parts, exposing them to toxic elements. If the crypto industry achieves its goal of dominating the financial realm, we can expect environmental conditions to worsen.
A Path Toward Steep Emissions
Researchers evaluated the future of crypto’s ecological impacts, finding its mining emissions may reach 130 million tons by 2024. The pollution count exceeds that of Italy and the Czech Republic. Mining in China may also account for 5.4% of the country’s total emissions, degrading the air quality and fueling atmospheric damage.
Professionals also expect e-waste pollution to increase as cryptocurrencies gain global popularity. Over time, the industry may become a key player in expanding climate change effects. Researchers are evaluating the potential harm in crypto and developing sustainable solutions for the future.
One solution involves placing an environmental tax on the coins. Part of the tax may go toward minimizing emissions using carbon capturing and offsetting. Mining facilities can additionally reduce atmospheric pollution by sourcing their electricity from renewable sources.
Another solution involves developing external policies to regulate the industry’s environmental impacts effectively. Creating universal guidelines may create new challenges because of crypto’s global scale. Professionals are confident they may achieve carbon-neutrality in the future with adequate regulations.
Is It Worth the Investment?
It is essential to weigh the pros and cons before investing in crypto. You can ensure the low environmental impact of your investment by conducting prior research on the coin’s commitment to climate change prevention. Additionally, you may explore personal steps you can take to neutralize emissions, shrinking your carbon footprint over time.