Environmental Hazards of Crypto Mining

by Ahuzi Vincentia
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Cryptocurrency is one of the developments of blockchain technology. This technology has gone a long way since its inception, with the surge in its popularity. However, crypto mining is the aspect the world embraces the most.

Crypto mining Overview

Cryptocurrency is a decentralized digital currency. It is based and secured on strong cryptography that uses very complicated encryption methods. These digital assets are extremely secure with just a little danger of counterfeiting. 

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It’s entirely Peer-To-Peer which means it doesn’t require an intermediary like a bank. Everyone has access to an evolving public record called a ledger that records transactions between users. This system offers significant benefits over centralized currencies. 

Transactions can only take place once a complicated cryptographic puzzle is solved. This process takes a lot of computing power and the amount of energy that is being consumed is much. There are concerns about how crypto mining affects the environment. 

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Is Bitcoin environmentally friendly?

The backlash against this technology with the effects of crypto mining (like Bitcoin) on the environment has been a major concern. This is associated with increased energy consumption and crypto mining pollution. There is a global agenda of making our planet greener and more sustainable. However, the environmental impact of crypto mining and the energy consumption of its networks have been the biggest argument against the adoption of Cryptocurrency.



There has been much discussion in mainstream and social media regarding the environmental impact of crypto mining and its energy consumption. The awareness of this problem among cryptocurrency investors and the general public varies. There are mixed opinions. Whether you are a crypto enthusiast or not, the fact that bitcoin and other Proof-Of-Work blockchains use massive amounts of energy cannot be overruled.

Besides, there are over 5,000 cryptocurrencies available which can pose a significant threat to the environment. Although the benefits of crypto mining are obvious and revolutionary. Still, the climate system needs to be put into consideration as it affects nearly all aspects of our lives.

How do Bitcoin and other Proof-Of-Work blockchains affect the environment?

Bitcoin and other cryptocurrency transactions are recorded by a distributed network of miners. This requires solving complex cryptographic puzzles. The energy required to do all this is called the Proof-Of-Work

Proof-of-work (PoW) is a form of adding new blocks of transactions to a cryptocurrency’s blockchain. This consensus mechanism keeps the blockchain secure and the whole system running without the need for a middleman.

When a miner solves the cryptographic puzzle, a verified record of a recent transaction is minted, and a block gets coupled to all previous blocks. This is the blockchain. The first miner or computer who solves the cryptographic puzzle and adds a new block to the chain gets rewarded with some newly minted cryptocurrency. As of the time of writing, miners are rewarded with 6.25 worth of BTC for successfully recording a new block on the chain.

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Bitcoin mining.

As the price of Bitcoin and other cryptocurrencies skyrockets, the crypto mining puzzle becomes increasingly complex. These cryptographic puzzles cannot be solved by hand. This means miners need highly specialized computers to do the work for them. For the work to be done, massive amounts of electricity are consumed. 

Right now, there are an immense number of computers all over the world. Each running at high speed, making attempts to solve the puzzle and record a new block. With all this being electricity-based, the competitive nature of Proof-Of-Work blockchains has resulted in stratospheric energy expenditures. 

The amount of energy that is used to run the algorithms on digital assets like Bitcoin has a significant environmental imprint. The energy required for a single Bitcoin transaction could be able to power a home and everything in it for nearly a month. Around the world, all the Bitcoin miners and their computers are using about half percent of the entire planet’s electricity. Much of this energy is derived from the combustion of coal and other fossil fuels.

This causes worries about the high-energy consumption of crypto mining resulting in increased carbon emissions and climate change. So, if crypto is one of the currencies of the future, its price will go up, and the puzzle will get harder. This means that as time goes on, the network will require more computing power and energy, to handle the same amount of transactions.

50% – 70% of crypto mining revenue goes to paying electricity bills. If this is the case, there is so much electricity needed or used to show your proof-of-work. Cryptocurrency requires mining and mining requires electricity. Therefore, crypto miners are incentivized to find and exploit the cheapest source of electricity. 

Currently, the cheapest source of electricity used is fossil fuels. Miners move to areas with the lowest energy cost. One of those places is China. Most crypto mining takes place there, and its energy comes from fossil fuels. Miners flock to Siberia where the cold naturally cools servers and also Iran where electricity is subsidized.

There are extraordinary levels of carbon emissions, energy consumption and electrical waste caused by Bitcoin usage and mining. These are some of the environmental impacts of crypto mining.

Read also: How to transition into tech as a Nigerian 

Environmental effects of Bitcoin

Bitcoin is the most extensively mined cryptocurrency network. It was estimated that Bitcoin mining consumes 91 terawatt-hours of electricity annually. Also, it emits nearly 37 megatons of carbon dioxide into the atmosphere every year.

Aside from energy usage, bitcoin mining produces a large quantity of technological trash. Highly specialized chips of hardware called Application-specific integrated circuits (ASICs) are used to mine popular cryptocurrencies. However, unlike other types of computer hardware, they cannot be used for another task or even another type of crypto mining algorithm. They also go out of date with time.

Every year, the bitcoin network creates 30,700 tonnes of electronic waste, on estimation. If everyone starts using Bitcoin, its network would eventually consume more power than the world has to offer. 

A panacea to the environmental impacts of crypto mining

Not all Cryptocurrencies are alike. Some run on a Proof-Of-Stake consensus as opposed to Proof-Of-Work. Using the Proof-Of-Stake consensus mechanism, owners stake some of their coins. This is in exchange for the chance to validate new transactions and add them to the blockchain, thereby earning a reward. 

Cryptocurrencies such as Solana, Cardano and Cosmos use Proof-Of-Stake methods to verify the blockchain.

Read also: A guide to the metaverse demystified for Nigerians


As the crypto industry expands rapidly, so are the concerns about the environmental impacts of cryptocurrency. On the positive side, crypto will power a decentralized internet. It has a great potential to transform several industries ranging from finance, banking, gaming, entertainment and even human interaction. 

How does crypto mining affect the environment? I hope this article has answered that question. You can subscribe to our newsletter to keep track of more engaging technology-related articles and follow us on Twitter for updates on similar posts. Thanks for your time!

About Author

Avatar of Ahuzi Vincentia
Ahuzi Vincentia
Ahuzi Vincentia is a Cryptocurrency content creator and ardent writer. She is passionate about research and self-growth. 

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