The new study is concerned that unless nations seek to lower the energy use by Bitcoin and similar blockchain designs, then this could prevent governments from reaching their climate change mitigation obligations under the Paris Agreement. It has been estimated that the processes involved in a single Bitcoin transaction is equivalent to providing electricity to a British home for one month.
Based on the adverse impact upon the environment, the research draws up tax and regulatory options which could be used to incentivize the development of ‘green’ blockchain technology, as an alternative to the way most blockchain solutions have been structured.
Lead researcher Jon Truby, of Qatar University, recommends a new approach that uses new forms of taxes, charges, or restrictions in order to reduce demand by users, miners, and miner manufacturers who employ polluting technologies. Alternatively, there should be measures and incentives to encourage developers to create less energy-intensive and carbon-neutral blockchain.
The research has been published in the journal Energy Research & Social Science. The research paper is titled “Decarbonizing Bitcoin: Law and policy choices for reducing the energy consumption of Blockchain technologies and digital currencies.”
In a different study, researchers have estimated that Bitcoin will use half a percent of the world’s electric energy by end of 2018. With this research, financial economist and blockchain specialist Alex de Vries has used a new methodology to pinpoint where Bitcoin’s electric energy consumption is headed and how soon it might get there. The methodology is outlined in the journal Joule: “Bitcoin’s Growing Energy Problem.”
