Bitcoin is fueling the climate crisis: Greenpeace USA

Greenpeace USA – an environmental group – is calling out Bitcoin for having what it calls an “outdated and inefficient” coding system.

In a tweet Thursday, the organization doubled down on claims that Bitcoin’s proof-of-work mechanism is contributing to the climate crisis. Instead, it proposed replacing the code with a less energy-intensive proof-of-stake mechanism.

Campaigns against mining

The prosecution team’s statements was in response to Ethereum’s successful merger on Thursday—an event that transitioned the protocol from proof-of-work to proof-of-stake.

“Ethereum just proved that cryptocurrency doesn’t have to come at the expense of a livable planet,” the non-profit said. Meanwhile, it criticized Bitcoin for continuing to consume more electricity than “entire countries”.

Bitcoin’s energy consumption can fluctuate as market conditions change, but has generally risen over time as the Bitcoin mining industry expands. According to Cambridge Bitcoin Electricity Consumption Index, Its theoretical upper limit consumption is about 159.63 TW/h right now. In comparison, the entire country of Norway consumes approx. 124 TW/h, per data from Forbes last year.

Its energy footprint comes down to proof of work – a mechanism for achieving blockchain consensus and security by consuming energy. Specifically, users (miners) expend energy in a race to build Bitcoin’s next block, with winners rewarded with BTC. Naturally, as the price of Bitcoin rises over time, they are incentivized to burn more energy to earn additional rewards.

As Greenpeace explained, this process encourages miners to bring old coal and gas plants “back to life”, thereby “fueling the climate crisis”.

“It doesn’t have to be this way,” the nonprofit argued. “Ethereum – one of Bitcoin’s top competitors – just changed its coding system to reduce energy usage by 99.95%.”

Greenpeace last targeted Bitcoin in March, following Ripple co-founder Chris Larsen financed a $5 million campaign to see Bitcoin transition to proof of stake. As last time, Greenpeace has also called on Bitcoin-linked tech billionaires – Jack Dorsey and Elon Musk included – to spread awareness about the energy footprint.

Arguments for proof of work

Still, Bitcoiners aren’t budging. Dorsey, for one, made clear his distaste for evidence of stake records afterward sharing a blog post extolling the superiority of proof of work on Wednesday.

Dorsey also signed a proof-of-work letter to the Environmental Protection Agency in May, which criticised evidence of effort to be subject to centralization.

MicroStrategy’s executive chairman Michael Saylor has also stopped pulling punches in his defense of Bitcoin mining.

“[Bitcoin’s carbon emissions] would hardly have been noticed were it not for the competing guerilla marketing activities of other crypto promoters and lobbyists seeking to focus negative attention on Proof of Work mining,” he said in a letter on Wednesday.

There is also the question of how much global emissions would fall if the transition actually took place. Bitcoin is estimated to be responsible for about 0.08% of global emissions right now, which will presumably be the limit of emissions reduction.

Furthermore, the merger has shown that not all miners will go offline after such an upgrade. Rather, it seems that many have migrated to other proof of work chains, such as Ethereum Classic.