The cryptocurrency Bitcoin has a CO2 footprint that is twice as big as Switzerland’s, according to an evaluation by the crypto portal Digiconomist. The Bitcoin network currently generates 90.93 million tons of CO2 per year, compared to Switzerland’s greenhouse gas emissions of around 45 million tons annually. The high emissions are due to the energy consumption of the blockchain technology on which the Bitcoin network is based.
Blockchain technology is used to validate transactions on the Bitcoin network in a secure manner. This process, known as “Proof of Work,” involves solving complex cryptographic puzzles to add entries to the blockchain and mine new crypto coins. This competition for solving puzzles and earning rewards consumes a significant amount of electricity, much of which comes from fossil sources, leading to high CO2 emissions.
A single Bitcoin transaction currently produces as much CO2 as watching 112,000 hours of YouTube videos or processing 1.5 million credit card transactions. The price of Bitcoin has reached record highs in recent months, outperforming traditional assets such as global stock markets or gold. While demand for cryptocurrencies is expected to continue growing, critics argue that Bitcoin has no intrinsic value and is purely speculative.
Bitcoin is currently experiencing a “Halving” event, where the number of new Bitcoin tokens issued is cut in half every four years. This event is seen as a potential catalyst for price increases, although experts warn of significant price fluctuations in the cryptocurrency market.