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Can Cryptocurrency Mining Support Sustainability?

Last updated: June 24, 2022

There is a lot of attention to cryptocurrency, the financial markets, and the blockchain in general. This is especially true in periods of high volatility, meaning that the markets are either in an uncontrollable downward spiral or in a bull market so strong that no one can seem to stop prices from setting new 52-week highs every single trading session. With so much media attention on cryptocurrency, it has brought to light certain issues that should be addressed - outside of crypto being used as an investment vehicle. This article is all about crypto, and we aim to answer the question: Is it sustainable?

First, this post will talk about cryptocurrency and how it is mined traditionally, and next - define "green crypto" mining. Finally, we'll talk about companies or coins themselves that support a sustainable way to achieve the asset without needing to sacrifice your morals or your virtues in regards to the social, governance, and environmental impact on the planet itself.

What is Crypto Mining?

Cryptocurrency is a side effect of the blockchain, meaning that it uses this technology to create a tradable asset.

Cryptocurrency is the name given to a new kind of digital currency that we use both as a storage of value and as a means to trade goods and services. This goes with the traditional methods of fiat and asset-backed currency, which offer the best of both worlds.

Fiat currency is the current popular method that most governments use to track their money supply and deliver it to their citizens. Fiat currency is synonymous with the "paper" currency that we hold, but also its denominations used in wires and other methods of transfer. Fiat money is centralized, meaning the flow of this currency is dictated by the government, and in capitalistic countries, by the financial system (banks and financial institutions). The federal government seeks to manage inflation by either printing more money or adjusting interest rates. In rare times, they actually remove money from the system to cause deflation or create a new currency altogether with smaller denominations.

Asset-backed currencies have fallen out of favor. While it is extremely secure to have a currency whose value is tied to precious commodities (usually gold), few countries still operate this way, and many do actually adopt a hybrid approach, only using assets as an emergency store of value in undisclosed storage. This method used to be the way we bartered throughout history (mainly in the medieval and dark ages) but it severely restricted the amount of money in the system to only the upper and richest classes.

Cryptocurrency works by recording transactions instantaneously when used for a sale, purchase, or transfer/trade. Its value is dictated by its speed and the price the next person is willing to pay for it. Naturally, some sort of limit must be kept on the coin or it will increase exponentially forever. This is why the cryptocurrency is created with a limit in mind and is only given out through solving complex algorithmic problems. The issue is these problems require significant computing power, which drains energy resources. This leads to burning fossil fuels and carbon emissions, speeding up our destruction of the ozone layer, and drastic climate change.

Mining centers use up a ton of power and also generate a lot of heat. This contributes to global warming, negative climate change, increased power costs and promotes unsustainable energy methods.

What is Green Crypto Mining?

Green crypto mining is just as it sounds, it is cryptocurrency mining that focuses on solving algorithms either through the use of renewable energy, or the coin itself is only given out through means which are sustainable to the economy, environment, and other socio-economic factors. The aim of green crypto mining is to be "carbon-neutral", meaning that it does not release any carbon emissions into the atmosphere, or that the emissions it does produce are negated in some way - by filtering it through before release, or by creating forests that have the ability to recycle the carbon into oxygen and nitrogen. This can be done in two different ways:

Mine crypto with renewable power. Mining takes power in two different ways - having the computing power to perform the mining, and having an effective cooling system to stop the engines from overheating and exploding. Solar, wind, and nuclear energy are all great examples of renewable methods to use.

Purchase coins that deliver their coins sustainably. Some projects offer coins in exchange for good habits, such as investing in ESG stocks, purchasing sustainable products, or just purely in exchange for fiat money. We will talk about these companies below.

Best Sustainable Crypto Mining Companies

Cardano: Cardano was created by the founders of Ethereum and uses a unique proof system. The proof system requires users to purchase coins in order to join the network, meaning it makes people conscious of what they are doing. It is the most well-known green cryptocurrency and is reviewed on a peer basis rather than its developers, drastically reducing its energy requirements.

Solarcoin: Solarcoin is a great project, generating one coin for every megawatt-hour of energy that is used from solar power ONLY.

Bitgreen: Bitgreen is a new coin that aims to reward users for sustainable actions. It is also on track to becoming one of the few vegan-friendly coins. You receive coins in this project by doing certain actions, such as carpooling or volunteering to pick up trash. You can also get rewarded for things such as purchasing fair-trade coffee.

FAQs

Why is bitcoin bad for the environment?

Mining centers use up a ton of power and also generate a lot of heat. This contributes to global warming, negative climate change, increased power costs and promotes unsustainable energy methods.

Does crypto mining take a lot of power?

Bitcoin mining takes an extreme amount of power. To complete one transaction would cost the average American 200$ in energy bills. To put this in perspective, global Bitcoin mining uses more energy than the entire country of Argentina.

What is a crypto mining farm?

Mining farms are extremely dangerous, not just for their emissions and power intake, but because they attract unscrupulous intentions. Because they are usually illegal, poorer countries would be laxer in their rules on mining farms to attract investor dollars. For example, there are 50,000 mining rigs in Kazakhstan. As a result of this, over time, the climate in Kazakhstan could alter drastically, affecting the local fauna and flora and destroying habitats.


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