Many studies have shown that Bitcoin transactions have a high carbon footprint and use a lot of electricity. Christian Stoll, a researcher at MIT’s Center for Energy and Environmental Policy Research, and Alex de Vries, the founder of Digiconomist, have released a new study that sheds light on the electronic waste that Bitcoin generates.
This research, titled “Bitcoin’s Growing E-Waste Problem,” sheds light on yet another aspect of Bitcoin’s wasteful design.
Bitcoin’s Electronic Waste Problem
Most studies have overlooked the fact that Bitcoin miners use a lot of short-lived hardware, which could lead to an increase in global electronic waste.
“From toxic chemicals and heavy metals leaching into soils to air and water pollution caused by improper recycling, e-waste poses a growing threat to our environment.”
A single transaction generates 272 grams of e-waste, the same amount of electronic waste as throwing two iPhone 12 minis in the trash, according to the study. The bitcoin network processed 112.5 million transactions in 2020. (compared with 539bn processed by traditional payment service providers in 2019).
“As of May 2021, Bitcoin’s annual e-waste generation totals 30.7 metric kilotons,” they claim. “This figure is comparable to the amount of small IT and telecommunications equipment discarded in the Netherlands.” This amount of waste could rise to over 64.4 metric kilotons. They also point out that demand for mining hardware is already disrupting the global semiconductor supply chain, which is currently experiencing a global shortage due to increased demand from the coronavirus pandemic, as well as a trade war between the United States and China and a drought in Taiwan.
Furthermore, Bitcoin mining has evolved from a simple laptop activity to a complex and expensive game involving powerful ASICs (application-specific integrated circuits). These ASICs were created specifically to mine cryptocurrency transactions. To stay competitive, miners must constantly replace their ASICs with newer, more powerful ones as technology advances. As a result, these single-purpose ASIC chips are quickly discarded. “The lifespan of bitcoin mining devices remains limited to just 1.29 years,” the researchers claim.
Miners have also been dumping tens of thousands of tonnes of ASIC rigs every year, according to researchers in Europe and the United States, contributing to the ever-growing environmental challenge.
Alex and Stoll also warn that if the price of bitcoin continues to rise, the e-waste problem will likely worsen, as it will encourage more investment in and replacement of ASIC hardware.
The paper concludes that if the community wants to reduce its e-waste problem, it must replace bitcoin mining in its entirety with a more sustainable alternative. As an experimental replacement for “proof of work,” one of these alternatives is “proof of stake.” “The block is broadcast to all nodes in the network by the first miner who finds a PoW [proof of work] that meets predetermined conditions. The receiving nodes show their approval of the new block by building on top of it, according to the paper.