With the recent crypto market bull run and last week’s Coinbase NASDAQ listing has come a fresh wave of media scrutiny surrounding blockchain-based currencies. This time it was none other than The New York Times chiming in with a piece in their Climate and Environment section framed as “a reminder” that cryptocurrencies use a lot of energy. While the article makes some fair points, I would like to “remind” the NYT of a few key items that were left out of their discussion.
The piece leans heavily on a metric from Cambridge University research estimating that Bitcoin mining uses more electricity than entire smaller nations, generating a carbon footprint that could push global warming further toward catastrophic levels. Now, I approach this topic as someone who cares very much about the environment. I’ve been a vegetarian for the last five years largely because of my disdain for the meat industry’s contribution to the destruction of our planet. Let’s be clear, there is no amount of carbon emissions that should be considered a good thing. However, if we are going to point a finger at crypto mining operations, we need to do so with at least a shred of perspective. More energy was spent on Christmas lights during the month of December in the United States alone than all of crypto mining worldwide throughout the entire year¹. Email results in emissions equivalent to 7 million additional cars on the road every year² (talk about country-sized environmental impact). Perhaps most ironically of all, both mining for gold - which people have traded for decades - and the current banking system we have in place that decentralized finance aims to disrupt, dwarf the energy expenditure of even the most energy-guzzling crypto consensus protocol (Proof of Work systems).
bUt wHaT AbOuT aT sCaLe!? As more people start to use the bitcoin network and more transactions are processed, won’t the emissions increase exponentially? This question sort of ignores the major fact that really all of the blockchain world is a work in progress. The internet itself is less than 40 years old, yet think of how different the web looks now from how you might remember it even a decade ago, a time when Bitcoin barely existed! Part of the beauty of tech is that nothing is truly ever finished. Problems arise and we solve for them in a continuous hamster wheel of innovation. As crypto adoption grows, inefficiencies will be addressed; and it’s already happening, which the NYT piece does point out near the end with discussion of Proof of Stake and new blockchain climate policy.
What is perhaps most comical of all, is the underlying implication of this “reminder” that maybe we could consider taking a step back from crypto. That maybe if people just started making a choice not to mint that NFT, we could turn this train around before it’s too late. Well I’m afraid I have some news for you on this one, “too late” came and went in 2010. If you are still debating whether cryptocurrencies should or should not be part of the future, you are frighteningly far behind in the conversation. Decentralization is already being baked into our technological infrastructure. It is already inextricably woven into systems in ways that will only increase from here. The future is upon us. To suggest that crypto could simply be removed because it is bad for the environment is like suggesting that cars could be eliminated from society to better the earth by everyone simply “choosing not to drive”. Our entire infrastructure is already built around roads and highways and relies on this for transportation of goods! What we see instead is improvement on what is already here - i.e., the evolution of electric and autonomous vehicles.
Speaking of systems that could use improvement, the central banking and fiat monetary system certainly stands out near the top of the proverbial dumpster fire. This system is promoting debt, consumerism and pollution through spending instead of saving. It keeps the poor in poverty. It enables wars and destruction by printing money without creating new value. A certain ecological disaster. So no, the NYT is not wrong, per se. We should continue to put pressure on the blockchain space to be as kind to our planet as it can be. But at the same time, we must recognize that it may be our savior from the beast that is already here. If a moment is arriving with a lifeline to level the playing field of opportunity in our society, we can’t choose that moment to be the only moment where we point a finger to the environment. While we argue amongst ourselves, the beast continues to feed and relishes in our chaos.