White House: Bitcoin Mining Must Be Greener – Or US Should Ban It

The White House suggested today that US lawmakers and regulators may soon crack down on cryptocurrency mining due to the large carbon footprint.

In a Thursday report, mandated by President Biden in a verdict in March, the White House Office of Science and Technology Policy so crypto miners should reduce greenhouse gas emissions, with help from the Environmental Protection Agency (EPA), the Department of Energy (DOE) and other federal agencies.

It proposed that the government collect more data on electricity use from industry, promote energy efficiency standards – and it promoted “the use of environmentally responsible crypto-asset technologies”.

But the White House also went so far as to say that if measures to make mining greener don’t work, energy-intensive cryptomining, namely Bitcoincan be banned entirely.

“Should these measures prove ineffective in mitigating the impacts, the administration should examine executive action and Congress may consider legislation to limit or eliminate the use of high-energy-intensive consensus mechanisms for mining cryptoassets,” the report said.

Mining cryptocurrencies such as Bitcoin uses enormous amounts of energy: to verify blocks of transactions to blockchains, a lot of computing power is needed – so mining is often done on an industrial scale.

And the US is now a hotspot for Bitcoin mining. After China cracked down on the industry, mining flowed to North America: today’s report added that the US share of global Bitcoin mining rose from 3.5% in 2020 to 38% now.

This could hinder the US’s “climate commitments and goals”, the report says.

In March, President Joe Biden signed an executive order that sought to establish a broad strategy for the US government to regulate the crypto industry, including mining.

Today’s report also noted the difference between proof-of-work and proof-of-stake blockchains – and mentioned Ethereum’s long-awaited upgrade, known as “the merger.”

Next week, Ethereum, the second-largest cryptocurrency by market capitalization, is expected to transition to proof-of-stake, which will make 99% more energy efficientaccording to the Ethereum Foundation.

“There has been increasing demand for [proof-of-work] blockchains to adopt less energy-intensive consensus mechanisms,” it says. “The most prominent reaction has been Ethereum’s promised launch of ‘Ethereum 2.0,’ which uses a [proof-of-stake] consensus mechanism.”

Some experts – including prominent Bitcoiner and Head of Growth Marketing at Kraken Dan Held – have so when Ethereum’s upgrade is complete, Bitcoin’s high energy consumption will be more in the spotlight.