When China banned cryptocurrency mining in May 2021, forcing many Chinese miners to move abroad, analysts thought BTC mining would be more decentralized as well as more environmentally friendly. However, at least the second factor is more than controversial after the publication of the new study.
A new report, entitled “Revisiting BTC’s carbon footprint”, published by the scientific journal Joules, reports that the share of BTC green mining has surprisingly fallen by 17% after the Chinese ban from 42% to around 25%.
Chinese miners operating directly in mainland China held a dominant position in BTC mining until May 2021, with general estimates suggesting their 60 to 65% share of the total hashrate (total computing power spent on BTC mining). However, when the Chinese government banned mining, the BTC hashrate plummeted by about half. Thanks to this and the fact that Chinese miners quickly migrated elsewhere, the USA, Kazakhstan and Russia gradually won the top three in terms of the generated hashrate.
The loss of China’s share of BTC mining was perceived very positively over time, as BTC mining is currently more decentralized and the hashrate is again at historic highs. At the same time, however, it was expected to be more environmentally friendly, as previous reports indicated that much of BTC’s mining in China was powered by coal mines.
However, Joules magazine refutes this fact, undermining the claim that BTC mining is more environmentally friendly than in the past. Such conclusions were reached, for example, by the BTC Mining Council (BMC), which covers BTC’s largest western miners. He recently reported that the share of BTC green mining already exceeds 58%, which is a significant difference from the 25% reported by Joules.
Alex de Vries, one of the authors of the recent report, points out: “The study generally points to how BTC mining has become even dirtier since China’s ban last year. Many hydropower miners have now replaced natural gas extraction (in the US). In addition, coal-fired electricity in Kazakhstan is dirtier than electricity from Chinese coal. Overall, this makes Proof-of-work cryptocurrency mining even more carbon-intensive than before. ”