White House Report Asks Energy Use of Bitcoin and Crypto Assets

The amount of electricity used by Bitcoin (BTC) and other cryptocurrencies is exacerbating climate change, according to a new White House report.

The report stems from an executive order issued by President Joe Biden to address growing concerns about the environmental impact of cryptocurrencies as the industry grows in popularity.

If left unchecked, the report warns, the energy used by cryptocurrencies could hinder the country’s environmental goals to reduce carbon emissions.

“The use of electricity from digital elements contributes [greenhouse gas emissions]additional pollution, noise and other local impacts, depending on markets, policies and local sources of electricity.”

The White House Office of Science and Technology Policy (OSTP), the report’s author, says crypto assets use between 120 and 240 billion kilowatt hours per hour, or 0.4% to 0.9% of total annual electricity use in the world . In the United States, cryptocurrency assets consume up to 1.7% of US electricity use and a total of about a third of the world’s cryptocurrency operations.

The report states that the industry’s future energy requirements are unpredictable, but there is a need to establish standards for operations.

One recommendation is to start discussions among stakeholders, including the Environmental Protection Agency (EPA), the Department of Energy (DOE), state governments, and crypto leaders to work together to develop standards for a cleaner future.

“These should include standards for very low energy intensities, low water use, low noise generation, clean energy use by operators, and standards that strengthen over time so that additional carbon-free generation matches or exceeds additional electricity load of these facilities’.

The report emphasizes the importance of ensuring the reliability of power grids in communities where encryption functions may be deployed and suggests some requirements.

“To help US climate goals, industries could volunteer or be required to build zero-carbon energy capacity that generates more electricity than cryptocurrency mining requires, selling the excess clean energy back to the grid.”

The report states that the US has a target to reduce greenhouse gas emissions by 50%. which is 52% below 2005 levels by 2030, and achieve a clean energy electricity grid by 2035.

Last year, tech titans Jack Dorsey and Elon Musk challenged the conventional wisdom about Bitcoin’s energy use.

Musk agreed that BTC is in fact incentivizing renewable energy after Dorsey cited a report from Square Crypto, which is now known as Spiral.

“Solar and wind produce cheaper energy than fossil fuels. This should make them ubiquitous, but they are held back by one obvious flaw: they produce too much power when demand is low and not enough when demand is high. Batteries could fix this, but by themselves they are not economical enough.

What can fix this problem is an ecosystem where solar/wind power, batteries and bitcoin mining coexist to form a green grid that runs almost exclusively on renewable energy. Not only is this possible, it is possible without jeopardizing the profitability of the industry.”

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