According to a new study, a single bitcoin transaction requires a whopping 16,000 liters of clean water, an amount sufficient to fill a small swimming pool. This finding is significant as it sheds light on the previously overlooked water usage associated with cryptocurrencies, particularly bitcoin.
The assessment, conducted by Alex de Vries from the VU Amsterdam School of Business and Economics, reveals the substantial environmental impact of bitcoin’s water consumption. De Vries estimates that in 2021, bitcoin’s global water usage reached 1.6 trillion liters, and this figure is expected to climb to 2.3 trillion liters in the current year. The primary source of this water consumption is attributed to the energy-intensive process of mining that secures the bitcoin network.
It’s worth noting that the majority of the water usage is linked to electricity production, including coal and gas plants, as well as the operation of hydroelectric power stations. Furthermore, water is directly utilized in cooling the powerful hardware used for mining in data centers.
While bitcoin’s water consumption is a pressing concern, it is overshadowed by its colossal energy demands. De Vries emphasizes the inefficiency of the mining process, stating that it essentially involves generating random numbers with no practical utility, thereby resulting in a significant environmental toll.
In contrast, the cryptocurrency Ethereum has successfully implemented changes leading to a remarkable 99.99% reduction in its energy usage, consequently lowering its water consumption. However, the bitcoin community has been reluctant to embrace similar changes, partly due to the absence of centralized control within the system.
De Vries underscores the availability of software solutions to mitigate bitcoin’s environmental impact, highlighting the opposition within the community against implementing such changes. He asserts that altering the software could instantaneously eliminate a substantial portion of the carbon emissions, water footprint, and electronic waste associated with bitcoin, potentially reducing its global electricity consumption by 50%.
