Coin Metrics co-founder Nic Carter has produced a lengthy defense of Bitcoin, amid reports that the currency uses dirty energy and is environmentally unsustainable.
Writing on blog platform Medium, Carter argued that Bitcoin’s mining costs are comparable to those of gold and that use of off-grid, and excess, energy in less densely populated regions can offset the energy-hungry mining methods required.
In the article titled “Noahbjectivity on Bitcoin mining”, Carter counters the view put forward by Bloomberg columnist Noah Smith who previously raised the alarm over Bitcoin's un-eco-friendly and unsustainable methods of generation.
In the original article, Smith argued that the more the price of Bitcoin increased, the more energy it consumed.
“The more Bitcoin’s price goes up, the more resources it consumes. In early 2017, when the price was only about $1,000, the website Digiconomist estimates that Bitcoin mining used about 10 Terawatt-hours per year in electricity”, he said.
Carter considered this argument and argued that gold has the exact same property. “Gold has this exact same property, so it doesn’t make sense to single Bitcoin out here”, he said.
Smith argued that Bitcoin hogs local energy resources, but Carter presented an alternative perspective, arguing that Bitcoin was mined in regions with excess production of energy.
One example we have reported on is Norilsk, which generates its own energy using hydropower and natural gas. Carter pointed to China and the main provinces that are currently mining Bitcoin; Xinjiang, Sichuan, Inner Mongolia and Yunnan.
Focusing on the period between Q4 2019 through Q2 2020, Carter said that “they produced 63% of the global Bitcoin hashrate […], according to the CBECI”.
He went on to explain that these regions had “relatively low population density” but an abundance of energy resources, which made mining sustainable. Bitcoin miners did not choose the locations randomly, Carter ventured to argue.
Earlier this week, Miami mayor Francis Suarez also raised concerns that Bitcoin produced outside of the US was mostly produced with “dirty energy”.
Nic Carter's post that argues against the environmental impact of Bitcoin is worth reading in its entirety and we recommend that you do.