Researchers Investigating the Environmental Impact of Mining Cryptocurrencies

Thecryptowriter

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Feb 7, 2106
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Researchers at the University of New Mexico are exploring the environmental cost of mining cryptocurrencies. Cryptocurrency mining involves validating transactions and adding them to the blockchain. Miners are then compensated for their efforts. While anyone with a computer and internet connection can mine cryptocurrencies, it's not always profitable. Factors that can have an effect on profitability include the cost of electricity, the speed of the computer, and the cryptocurrency being mined.

"What is most striking about this research is that it shows that the health and environmental costs of cryptocurrency mining are substantial; larger perhaps than most people realised", said Benjamin Jones, University of Mexico Researcher and Assistant Professor of Economics.

Over the years, mining farms have increasingly dominated cryptocurrency mining. Located in countries in which electricity is substantially cheaper such as China, mining farms use vast amounts of energy in their efforts to solve the complex computing algorithms behind each set of transactions.

In a new research paper titled Cryptodamages: Monetary value estimates of the air pollution and human health impacts of cryptocurrency mining, University of New Mexico researchers Andrew Goodkind, Benjamin Jones, and Robert Berrens estimate the impact that cryptocurrency mining techniques have on the environment.

Published in the Energy Research & Social Science journal, the paper states: "With each cryptocurrency, the rising electricity requirements to produce a single coin can lead to an almost inevitable cliff of negative net social benefit". Encouragingly, the paper goes on to highlight that some cryptocurrencies require significantly less energy than the likes of Bitcoin.