An article recently published in Ethereum World News has shed light for the first time on the true environmental costs of bitcoin mining versus traditional banking. Whilst there has been plenty of attention on the impact of rising energy costs on the profitability of cryptocurrency mining, this is possibly the first time any specific research has been applied to the product lifecycle of traditional currency and cryptocurrency to understand the true environmental impact.
So what did the research find? At a best guesstimate, cryptocurrency could be as much as 10,000 times more efficient than traditional banking, based on a wide range of factors including hardware and energy costs for the production of each unit of currency, as well as energy consumed through day to day banking operations in the form of light, heat and electricity consumed in branches and energy used to run ATM’s.
John M. Kwan, CEO of VeriPic, presented a compelling argument as to why anybody who is serious about sustainability should be backing a decentralised, blockchain based future for the financial system.
In his example, it currently costs a staggering $1.745 Trillion (9% of GDP) to run the US banking system, whilst in comparison, the 600,000 cryptocurrency mining machines currently in use consume just $198 Million of electricity per year.
The big question then – who benefits from the huge expenditure of the US banking system and similar systems worldwide and what influence do they have in determining the future of the world economy? Are these vested interests strong enough to surpress the rise of cryptocurrency?