Energy Impact of Crypto Mining Addressed in US House Hearing, Five Industry Experts Submit Testimonies

Finding alternate ways to power crypto mining operations, perhaps from renewable resources emerged as a common conclusion of the industry experts.

By Radhika Parashar | Updated: 21 January 2022 16:01 IST

Energy Impact of Crypto Mining Addressed in US House Hearing, Five Industry Experts Submit Testimonies

Photo Credit: Bloomberg

Crypto miners solve complex algorithms on advanced computers that heavily consume energy

Highlights

US energy-focussed committee received the testimonies
Experts advise powering crypto mining with clean energy
Crypto mining causing power outages in many parts of the world

The negative impact that crypto mining has put on power grids in several parts of the world, has become a matter of major concerns for many countries. The situation is the same in the US. Recently, five industry experts presented their testimonies before the US House Energy and Commerce Oversight Subcommittee. The topic was, “Cleaning Up Cryptocurrency: The Energy Impacts of Blockchains”. Since crypto mining needs to be performed on advanced computers, its power consumption rate is excessively high.

Finding alternate ways to power crypto mining operations, perhaps from renewable resources, emerged as a common conclusion of the industry experts.

Brian Brooks, a former top US banking regulator and ex-CEO of Binance US was among the industry experts to submit his opinion on crypto mining.

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He argued that eventually, this energy consuming process of Bitcoin mining would turn out to be “economically productive”. Brooks also said that mining of physical elements like gold also consumes high amounts of energies.

Gregory Zerzan, a shareholder at business law firm Jordan Ramis along with John Belizaire, the founder and CEO of Soluna Computing and Steve Wright, a recently retired former general manager of the Chelan County in Washington presented similar opinions in their testimonies. Both pushed the idea of encouraging crypto mining using clean energy sources.

An interesting argument in favour of the Blockchain technology, but in criticism of Bitcoin's high power mining demands was extended by Ari Juels, a technology professor at the prestigious Cornell University.

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“The tremendous promise of Blockchain technology does not require Bitcoin or its energy-intensive component called proof-of-work,” Juels said.

He added that Ethereum blockchain's transition to proof-of-stake (PoS) would likely consume “far less electricity” and support smart contracts as well as non-fungible tokens (NFTs) — unlike Bitcoin.

The power-eating and environmental impacts of crypto mining began erupting in parts of the US last year.

In October, several New York City-based businesspersons reached out to governor Kathy Hochul requesting her to deny permits regarding the conversion of the city's old fossil fuel plants into crypto mining centres.

“Proof-of-Work cryptocurrency mining use enormous amounts of energy to power the computers needed to conduct business — should this activity expand in New York, it could drastically undermine New York's climate goals established under the Climate Leadership and Community Protection Act,” the letter to the mayor read.

In the Texas state as well, power outages caused due to the hike in Bitcoin mining activities, led to the deaths of several people during the winters.

Between January 1, 2016, and June 30, 2018, the mining operations for four major cryptocurrencies released up to an estimated 13 million metric tons of carbon dioxide, a research report had claimed last year.

In recent days, regions around the world including Iran, Kazakhstan, Kosovo, and regions in Russia had to take steps like temporary bans on crypto mining. The Svaneti city of Georgia made crypto miners pledge a holy oath against indulging in the process, due to electricity shortage.

Amid these concerns gaining heat, some regions are active taking measures to tackle this issue with crypto mining, in an efficient way.

Nayib Bukele, the President of El Salvador has revealed his plans of building a Bitcoin City at the base of the Conchagua volcano, in order to power Bitcoin mining with renewable energy and tackle the carbon footprint issue associated with the process.

Francis Suarez, the mayor of Miami, has also proposed setting up a Bitcoin-mining facility near a nuclear power plant in Florida. As per a report by Latest News Today, nuclear energy is on the brink of being recognised as a true environmental, social, and corporate governance (ESG) solution in terms of energy.

Interested in cryptocurrency? We discuss all things crypto with WazirX CEO Nischal Shetty and WeekendInvesting founder Alok Jain on Orbital, the Gadgets 360 podcast. Orbital is available on Apple Podcasts, Google Podcasts, Spotify, Amazon Music and wherever you get your podcasts.

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Further reading: Cryptocurrency, Bitcoin Mining, Cryptocurrency Mining, Crypto Mining, Bitcoin

Radhika Parashar

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Radhika Parashar is a senior correspondent for Gadgets 360. She has been reporting on tech and telecom for the last three years now and will be focussing on writing about all things crypto. Besides this, she is a major sitcom nerd and often replies in Chandler Bing and Michael Scott references. For tips or queries you could reach out to her at RadhikaP@ndtv.com. More