According to the analysis, the worldwide Bitcoin mining network released 42 megatons (Mt) of CO2 in 2021, a negligible amount. To simplify the comparison, the paper cited the quantity of carbon emissions reported from China and the United States.
“As a point of comparison, big industrialized nations such as the United States and China released 5,830Mt and 11,580Mt of CO2 in 2016,” CoinShares stated.
The results come at a time when countries including as India, Russia, and the United States are thoroughly examining the crypto industry in order to implement regulatory frameworks. To mine or produce a Bitcoin, powerful computers must solve difficult proof-of-work algorithms.
Due to the fact that these devices must be constantly connected to electrical sources, the mining process uses a significant amount of power. Due to the nature of Bitcoin mining, the process has been connected to possible high-carbon emitters.
Around 60% of Bitcoin mining activity is fueled by fossil fuels, which is on the low end of industry estimates, with others claiming as low as 25%. Additionally, CoinShares noted that although crypto mining is being inspected for carbon emissions, nothing is being said about the CO2 emissions caused during the creation of conventional valued commodities.
“Emissions from minting and printing fiat currencies are expected to be approximately 8Mt per year, whereas the gold sector is anticipated to emit between 100 and 145Mt of CO2 per year,” the report added.
The report’s findings closely align with those of American businessman Michael Saylor, owner of business analytics company MicroStrategy. Saylor referred to BTC mining’s carbon emissions as a “rounding mistake” last month at the Bitcoin Mining Council’s (BMC) quarterly briefing.
Additionally, the entrepreneur defended Bitcoins against Elon Musk, who canceled Bitcoin acceptance due to environmental concerns.