Bitcoin’s Price-Energy Link Investigated in UN Study A United Nations report has uncovered a significant relationship between Bitcoin’s price and the energy consumed by its mining activities. Researching 76 BTC mining nations during 2020-2021, the findings revealed a total energy consumption of 173.42 terawatt-hours, with the top 10 mining countries significantly impacting Bitcoin’s environmental footprint. This revelation is driving the crypto industry to prioritize greener energy sources and decarbonization efforts.
A recent United Nations study has revealed a significant relationship between Bitcoin’s price and the energy consumption associated with its mining operations. UN scientists examined the activities of 76 Bitcoin mining nations throughout 2020 and 2021, uncovering a total energy consumption of 173.42 terawatt-hours for the global BTC mining network.
During this period, the cryptocurrency market was in the midst of a bull run, leading to Bitcoin’s record-breaking surge to $69,000. The UN report emphasized the following key findings:
At that time, 67% of the electricity used for BTC mining was sourced from fossil fuels. Nonetheless, the crypto industry has shown a growing commitment to embracing green energy sources. Hydropower contributed over 16% of the global BTC mining network’s total electricity requirements, with nuclear, solar, and wind energy supplying 9%, 2%, and 5%, respectively.
Bitcoin Community Raises Doubts Over UN Report’s Citation
Critics within the crypto community questioned the UN report for referencing the Mora et al. 2018 paper, which had previously overestimated the carbon emissions of Bitcoin mining rigs by incorporating unprofitable mining rigs in its analysis. Notably, Nic Carter criticized the report for citing “completely fake academia in their papers (Mora et al. 2018).”
According to the UN report, the top 10 BTC mining nations at the time were China, the United States, Kazakhstan, Russia, Malaysia, Canada, Germany, Iran, Ireland, and Singapore. These countries were collectively responsible for 92% to 94% of the global carbon, water, and land footprint associated with BTC.
The global shift towards greener energy alternatives to meet electricity demands is expected to help reduce Bitcoin’s carbon footprint and the environmental impact of the broader cryptocurrency ecosystem.
In a recent development, Genesis Digital Assets Limited, a mining and data center company with a power generation capacity exceeding 400 megawatts worldwide, unveiled a new data centre in Sweden equipped with 1,900 Bitcoin mining machines. This facility runs on Sweden’s abundant renewable energy surplus.
Christian Anders, founder of BT.CX, explained that BTC mining is relatively uncommon due to high energy prices. However, he noted the ongoing efforts by BTC mining equipment manufacturers to produce more energy-efficient hardware. At the World Digital Mining Summit in September, several BTC miners shared their plans for decarbonizing the crypto industry.
Bitmain introduced the efficiency-focused Antminer S21, and Nazar Khan, the chief operating officer of TerraWulf, emphasized the role of Bitcoin rig manufacturers in “locating our Bitcoin mining loads in places where that’s happening and how do we facilitate that decarbonization process.” These initiatives reflect the industry’s commitment to reducing its environmental impact while maintaining the security and efficiency of the BTC network.