Compared to our current financial system, bitcoin uses a lot less energy. However, some environmentalists think otherwise; they see bitcoin mining as a waste of energy.
Bitcoin works just as well at small denominations as large ones, whereas fiat currency does not. This can be seen in the comparison of purchasing power between two currencies. In addition, making transactions with bitcoin saves the amount in fees and interest paid for using a credit card or other third-party bank-based payment system.
7 Ways how bitcoin impact the environment
Bitcoin offers a sustainable alternative for those who want to shape the future of finance.
1. Minimizes the use of paper money
Just think how much paper is wasted by businesses printing bills and coins that will never get used. It seems a waste of resources to print something that will only take on value once it’s in circulation. Bitcoin is digital and can be sent from wallet to wallet without printed money.
2. Minimizes the use of metals
Real-world currencies such as Yen and Dollars often rely on aluminium, zinc, nickel, and other metals. However, Bitcoin doesn’t need any of these physical materials to exist.
3. Bitcoin mining doesn’t require dangerous chemicals
Bitcoin mining uses the power of computing to solve highly complex problems leading to validating transactions on the blockchain ledger. As a result, it does not require potentially dangerous chemicals or reactions that create traditional banknotes. Learn more at Bitcoin trading.
4. Savings of energy and resources
The decentralized nature of the bitcoin network renders it immune to the risks associated with centralized banking like inflation, deflation, and cybercrime, leading to a high cost of security measures.
In addition, the use of traditional currencies such as the Yen or Dollar often requires banks to store large amounts of money for them to follow the 1:1 ratio between paper bills and coins. Bitcoin can function as a stand-alone currency without being attached to existing currencies or banks.
5. Electricity usage is affordable today
Note that electricity costs are low enough in many parts of the world where bitcoin mining has become an environmentally friendly activity compared to traditional value transfer methods. Also, the bitcoin network will only consume an estimated 0.5% of the world’s electricity by 2020, regardless of how much it continues to grow.
6. Bitcoin mining creates new opportunities for environmentally friendly energy usage
Bitcoin mining increases demand for renewable energy sources, which is good for our environment since alternative energy sources are often more harmful to the environment than traditional forms of energy.
The bitcoin network might use less electricity than Visa or Mastercard. Still, it’s important to note that the computers used in mining bitcoins are doing valuable work, unlike most modern appliances.
7. Bitcoin mining can help to create a better world for future generations
Bitcoin mining makes it possible to upgrade the electrical grid, create more reliable and efficient microgrids, or allow people who need electricity to get it from alternative sources such as solar, wind, or hydroelectric, which wouldn’t otherwise be profitable high infrastructure costs.
3 Cons of bitcoin on the environment
1. Bitcoin mining requires powerful computers
The most significant negative impact on the environment is that bitcoin mining uses high-powered computers running 24/7, which can cause stress to power grids and produce additional heat. However, this can be efficiently resolved by using more energy-efficient hardware to lower the overall electricity usage of the network.
2. Mining bitcoins requires significant investment in hardware
Bitcoin mining is often seen as an activity that requires zero-cost electricity, yet this isn’t quite the case considering the high cost of obtaining hardware. The price of bitcoin will need to increase further before it becomes profitable to mine at home with your equipment.
3. Electricity generated by fossil fuels
Even though most electricity generated in the USA comes from renewable sources, people still rely on coal or oil to produce it because it’s cheaper.
Bitcoin mining can be harmful to the environment, but our current banking system isn’t environmentally friendly either, and there’s plenty of room for improvement even with traditional currencies. Bitcoin is just one step towards a more sustainable economy.