Last year, Chinese President Xi Jinping targeted a summit on reducing carbon dioxide emissions in China by 2030 and by 2060 that China would be free of carbon dioxide emissions. This policy is considered to threaten Bitcoin mining.
This is a study from the University of the Chinese Academy of Sciences, Tsinghua University, Cornell University and the University of Surrey, published in the peer-reviewed journal Nature Communication, as quoted from CNBC International, Friday (04/09/2021).
About 75% of Bitcoin mining is done in China, where there is cheap electricity and relatively easy access to manufacturers who make specialized software, according to the study.
Bitcoin is generated by mining, by solving complex mathematical puzzles using a dedicated computer. This process uses large amounts of electricity, especially when done on a large scale. Bitcoin's carbon footprint in China is one of the 10 largest cities.
To mine Bitcoin worldwide it takes energy of 128.84 terrawatt-hours (twh) per year, this is greater electricity consumption than countries such as Ukraine and Argentina, according to a Cambridge University report.
"Without proper intervention and proper policies, the intensive operation of the bitcoin blockchain in China could quickly grow as a potentially damaging threat to emissions reduction efforts occurring in the country," the authors wrote.
"Without any policy intervention, the annual energy consumption of the bitcoin blockchain in China is expected to peak in 2024 at 296.59 Twh and produce 130.50 million metric tons of appropriate carbon emissions."
The authors note that China's bitcoin energy use by 2024 will exceed the total energy consumption of Italy or Saudi Arabia.
Even so, some say the study lacks the necessary data. One of them is Nic Carter, venture capital partner of Castle Island Ventures and co-founder of crypto site Coin Metrics who says this paper leaves a lot to be desired.
"I expect most papers on provincial-level data covering china's miner energy mix," he wrote on his Twitter account responding to the research.
"But it's gone. Instead, they claim to have considered this... but did not show his work. They just confirm that they've measured this."