Bitcoin Mining Harms Climate, Says Chinese Court – Grist
It’s Monday, July 25, and China continues to crack down on cryptocurrency.
A court in China cited the climate burden of cryptocurrency when it upheld a ruling that struck down a bitcoin mining contract. According to the decision, released earlier this month, the emissions generated by bitcoin mining exacerbate climate change and are incompatible with the country’s goal of reaching carbon neutrality by 2060.
Bitcoin mining is an energy-intensive process that uses many computers to verify transactions to its digital doctors. According to Climate Home News, the case in question involved a disputed business contract in which one company sued another for allegedly failing to mine all the bitcoin it had promised. But the lawsuit was dismissed by a lower court, which held the contract was void because it harmed the public interest. This decision was upheld by the Beijing Third Intermediate People’s Court.
“Judging by the high energy consumption of ‘mining’ and the impact of bitcoin trading activities on the country’s economic and social order, the contract involved should be void,” the court ruled.
The decision follows previous actions taken by the Chinese government to crack down on cryptocurrency. Last year, the People’s Bank of China made all cryptocurrency transactions illegal, saying they posed a serious danger to the “security of people’s assets.” The government has also ordered a halt to bitcoin mining in Sichuan province, where cheap electricity from hydropower had attracted many cryptocurrency operations.
Although the crackdown has caused China’s cryptocurrency-related energy use to plummet, it is not clear that this is a net win for the climate. Recent research suggests that bitcoin miners have simply moved out of the country to places where coal or natural gas is the primary energy source, driving up global cryptocurrency mining emissions.
Meanwhile, the cryptocurrency’s high power consumption has caused concern in the United States. During a scorching heat wave earlier this month, grid operators in Texas asked to shut down bitcoin mining — a move that helped prevent the electric grid from buckling at a time of soaring energy needs.
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