Bitcoin miners are helping oil companies cut flaring by using generators running on natural gas that would otherwise be burned.
It’s a controversial topic in the blockchain community that comes up from time to time — just how much impact Bitcoin (BTC) mining has on the environment. Last year, Tesla’s CEO Elon Musk brought forth a sharp correction in the cryptocurrency market by tweeting that Tesla would abandon plans to accept BTC, citing “rapidly increasing use of fossil fuels for Bitcoin mining and transactions.” However, a recent report published by CoinShares notes that despite the widespread use of coal, oil and gas for Bitcoin mining, the network accounts for less than 0.08% of the world’s CO2 production.
During an exclusive interview with Cointelegraph, Kristian Csepcsar, chief marketing officer at Slush Pool, the oldest Bitcoin mining pool, gave insight on what he believes are current misconceptions regarding Bitcoin mining’s environmental impact. When asked about the drawbacks of using electricity derived from oil and gas mine Bitcoin, Csepcsar says there are more than meets the eye:
“We’re literally burning the gas into the atmosphere just because it’s not economical to do anything with it [Flaring]. Instead, we can put it into a motor to produce electricity and use that to mine Bitcoin.”
Flaring is the process of burning surplus natural gas during oil extraction due to a lack of pipeline infrastructure to bring it to market. Recently in the U.S. and Canada, Bitcoin miners have found clever ways to instead funnel the natural gas to generate electricity, instead of simply burning it into the atmosphere, thereby solving a critical environmental problem.
But Csepcsar remains skeptical of certain renewable sources of Bitcoin mining, calling them “marketing noise,” specifically, solar energy. As he told Cointelegraph:
“On our blog, we published research that we are not big promoters of solar mining; when you calculate the profitability, it’s not that good; it’s a very tough business.”
Cespcsar further elaborates that approximately 70% of all solar panels are produced in China and that there has not been a lot of research on the environmental impact during their manufacturing process:
Producing them creates a lot of harmful chemicals. And nobody talks about that. Everyone just thinks that the solar panels grow on trees, and then the sun shines on them. But, no, the process of creating them is brutal.
On a final note, Slush Pool does not possess metrics regarding the source of energy used by its Bitcoin miners. When asked why this is, Cespcsar gave an answer that was surprising but perhaps true to the philosophy of decentralization and privacy:
“We don’t want to look at that as a pool operator. In order to have those numbers, we would need to KYC our miners, conduct audits on their operations, or even filter transactions [for analytics]. That’s not the ethos we want to keep.”