Bitcoin generates less electricity consumption than the traditional banking system and gold.
76% of Bitcoin miners use renewable energy sources, such as hydroelectric ones.
British banks in the city of London have financed projects that produce 805 million tons of carbon dioxide (CO2) annually, according to a study by environmental groups Greenpeace and the World Wide Fund for Nature (WWF).
If the financial institutions of the City of London were a country would rank ninth in CO2 emissions in the world, surpassing Germany and Canada, indicates the report of both NGOs dedicated to the preservation of the environment.
The activists’ study tracked the loans and investments they have provided the banks of the City of London. It revealed that, adding the projects and operating expenses, financial institutions they impact 1.8% more than the annual carbon dioxide emissions of the entire UK.
Bitcoin generates less energy consumption than traditional banking and gold mining according to financial analyst Yassine Elmandjra. Source: Pixabay
Insurance and security services are some of the projects, financed by London bankers, that generate the greatest emission of carbon dioxide, since according to the Rainforest Action Network they represent 65% of fossil consumption falls on these activities.
However, the study itself indicates that the estimates of greenhouse gas emissions could actually be even higher, since the protocol used does not contemplate the service of third parties in the financed entities.
To estimate CO2 emissions from loans and investment activities in the study entities, the protocol guidelines of the Association for Carbon Accounting Finance (PCAF) were used.
Information on the issuance of the funded institutions It is done through the reports that some of these companies make transparent (as electricity consumption). Although there are also other factors that were taken into account such as emissions based on physical operation and economic activity.
When entities do not have public information, third parties such as service providers or third party data providers are used. In addition to measuring electricity consumption, the region is also taken into account to estimate the type of source used.
But British banks are not the only ones, according to a study by the Rainforest Action Network, the 60 largest banking institutions in the world have invested USD 3.8 million in industries that implement fossil fuel, even after the Paris Agreement in 2015.
On 2020, the environment continues to be imprisoned of large investments of the most polluting banks in the world that invested USD 751 billion in fossil industries, an exorbitant figure that would have been climbing from 2016 to 2019.
“The Dirty Dozen”: the banks that are not following the Paris Agreement. Source: RAN.org
7 out of 10 bitcoin miners would use clean energy sources
The study by Greenpeace and WWF, is published amid accusations to bitcoin about the alleged damage it causes to the environment. Certain personalities would have pointed out that it had a high consumption of fossil fuels, which was denied by members of the bitcoiner community.
Although it is true that bitcoin generates high energy consumption to keep the network safe and efficient, what is false is that it uses a huge amount of fossil energy and contributes to the emission of carbon dioxide. But the bad image of cryptocurrencies spread after the statements made by the CEO of Tesla, announcing the suspension of bitcoin as a means of payment in the company.
Some bitcoiners feel that Elon Musk probably didn’t do much research before saying they affected the environment, as 76% of bitcoin miners use renewable sources, as indicated in a report prepared by the University of Cambridge in 2020.
62% of the world’s cryptocurrency miners use hydroelectric power, according to a 2020 estimate. Source: Pixabay
In general, the largest share of electricity generation in cryptocurrency mining is carried out through hydroelectric plants, with the exception of China, where the use of coal is high. Yet 62% of the world’s cryptocurrency miners use power from dams, according to a September 2020 estimate.
Another data to consider is the consumption of traditional banking, and the conclusion of the financial analyst of ARK Investment Management LLC (ARK), Yassine Elmandjra. In February 2021, Elmandjra said that bitcoin mining is clearly positive for the environment, even more efficient than traditional banking and gold.
Traditional banking consumes 2.34 billion gigajoules (GJ) per year and gold mining 500 million GJ, while Bitcoin consumes 184 million GJ, less than 10% and 40% of traditional banking and gold mining, respectively .
(Yassine Elmandjra analyst at ARKInvest).
Taking into account bitcoin’s efficiency vis-à-vis traditional banking, Binance CEO Changpeng Zhao scoffed: “Elon probably didn’t research how much power is required to run other (non-crypto) currencies Tesla accepts.”