Reducing carbon emissions in blockchain technologies
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The environmental impact of blockchain technologies such as Bitcoin and non-fungible tokens (NFTs) has come under more scrutiny in recent years. Now researchers from Qatar University have analyzed policy tools and interventions aimed at reducing carbon emissions from the blockchain industry and published these in an article in Energy research and social science.
The Qatar team, led by Jon Truby, links harm caused by blockchain activity to Paris Agreement goals and human mortality; they report that emissions attributed to Bitcoin in 2021 will be “responsible for around 19,000 future deaths.”
The researchers use NFTs as the focus of the study. NFTs are digital assets – such as photos, memes and music – that are stored and traded on a blockchain, a type of distributed ledger. The volume and value of NFT transactions exploded in recent years, reaching USD 10.7 billion in the third quarter of 2021,
This growth comes with an associated increase in carbon emissions due to energy-intensive “proof-of-work” (PoW) NFT blockchains; PoW is a method of adding new blocks of transactions to the blockchain. Social awareness of environmental costs has provoked a shift away from these PoW consensus protocols, and they need to be phased out, the researchers say.
Political interventions will be necessary if the blockchain industry does not respond to social pressure. The team observes that available tools may be poorly coordinated or underutilized and suggests alternatives for a sustainable blockchain.
Since blockchain technologies are a private enterprise with a social cost, these proposed measures are aimed at developers, miners and traders, who should be more willing to work with local communities to minimize their environmental impact. They may include, for example, charging a premium for miners’ electricity consumption, encouraging more efficient hardware, requiring reliance on clean energy, and imposing carbon offsets and/or a carbon trading scheme for mine operators and transaction partners.
The blockchain industry has the potential to provide many societal and business benefits, “Switching to more sustainable alternatives in advance will prevent the need for taxes, standards and regulations,” Truby and his team conclude.
Energy-intensive Bitcoin transactions pose a growing environmental threat
Jon Truby et al, Blockchain, Climate Damage and Death: Policy Interventions to Reduce Carbon Emissions, Mortality and Net-Zero Implications of Non-fungible Tokens and Bitcoin, Energy research and social science (2022). DOI: 10.1016/j.erss.2022.102499
Citation: Reducing carbon emissions in blockchain technologies (2022, August 25) retrieved on August 25, 2022 from
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