Bloomberg Intelligence’s crypto market analyst Jamie Coutts says that Bitcoin (BTC) is pulling off one major achievement that is flying under the radar.
Coutts says on the social media platform X that at the same rate that Bitcoin adoption is increasing, its network’s carbon emissions are declining, a rare phenomenon.
“And this is where the rubber meets the road: Bitcoin as a global monetary network is scaling while its carbon impact declines. Few industries can claim this achievement. (Zoom in to inspect the table as it has stacks of data).”
According to Coutts, one of the drivers behind the carbon footprint reduction is Bitcoin miners turning to more renewable energy to reduce costs.
“With energy constituting well over 50% of mining’s op cost, the incentive to acquire the cheapest energy sources is contributing to the network’s rising hash rate while simultaneously reducing the industry’s emissions or carbon intensity.”
According to Coutts, sustainable energy of total energy used for Bitcoin mining is now greater than 50% and climbing.
“This percentage had been rising since inception but kicked a gear higher when China banned mining in May 2021, knocking out several fossil fuel-powered operations (crackdown in Kazakhstan also helped).”
Coutts says that the renewable energy increase has reduced the amount of Bitcoin’s carbon intensity, which refers to how many grams of carbon dioxide (CO2) are released to produce a kilowatt hour (kWh) of electricity.
“Consequently, emissions intensity has declined from 600 to 296.5 grams of CO2 per KWh since then. Critically, the event also helped further decentralize the mining industry.”
Another data point Coutts looks at is the relative decline of carbon emissions per dollar of market cap.
Says Coutts,
“As we know Bitcoin remains 60% below the 2021 all-time high, but since 2019, network value has increased 335%, outpacing every asset but more importantly, the monetary debasement…
Since 2019, emissions from Bitcoin mining are flat in absolute terms (up 6.1%), while in relative terms i.e. emissions per dollar of market cap, they have collapsed 75%.”
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Featured Image: Shutterstock/MR.Somchat Parkaythong
