Web Development

Impact of Blockchain on the Environment

Published: 16th May, 2023

Arpit Mehar

Content Developer Associate at almaBetter

Blockchain is one of the most revolutionary and innovative technologies of recent years, and it is not anywhere close to its full potential just yet.

The two leading cryptocurrencies, Bitcoin and Ethereum, are using the same method to validate transactions and mint new crypto coins. Moreover, several multinational companies such as Amazon and Microsoft have welcomed blockchain technology with open arms to make specific operations more efficient and profitable.

Typically, people know that blockchains consume massive amounts of energy. Still, the reasons why and how to reduce it will be critical to the back-and-forths of blockchain-based applications and Web3 in a time riddled with the climate crisis. Keep reading to find out how much energy is used by cryptocurrency mining. We will also cover the other environmental impacts of cryptocurrency.

Environmental Impact of Blockchain Technology

As much as blockchain technology is a fascinating technology and is in line to be a key component of Web 3.0, many detractors seem to keep their sight of a significant flaw: the energy-intensive nature of blockchain processes. Unfortunately, there is no direct way to calculate how much energy is used for Bitcoin mining. Still, the figure can be estimated from the network’s hash rate and the consumption of commercially-available mining rigs.

According to a few studies, Bitcoin mining is now consuming more energy than the entire nation of Argentina every year. For instance, one Bitcoin mining uses approximately 2000 kW of electricity. On the other hand, an average American household consumes roughly the same electricity in 70 days. In addition, according to a tabled theory, the emissions from Bitcoin mining could raise the earth’s temperature by two degrees. Considering the current climate situation of the world, this model will just worsen the conditions.

Here comes the most ironic aspect; there are several projects powered by blockchain technology aimed at controlling climate change.

Can mining use less energy?

Generally, large-scale cryptocurrency miners are located where energy is ample, cheap, and reliable. However, processing crypto transactions and minting new coins does not need to be energy-intensive. On the other hand, considering the millions of dollars already invested in the framework of the current mining process, it will be a challenge to move to a more energy-efficient system.

Let’s look at some interesting ideas aimed at taming the energy-thirsty blockchain technology.

The proof-of-stake (PoS) method of validating cryptocurrency transactions and minting new coins is an alternative to traditional cryptocurrency mining. In addition, the technique does not demand extensive computing power. Instead, the authority to validate transactions and operate the crypto network is granted based on the amount of cryptocurrency that a validator has agreed not to trade or sell.

In a meeting between Elon Musk and a few CEOs of crypto mining companies, an idea for Bitcoin Mining Council was introduced, tasked with driving energy transparency.

The prevalent Ethereum network aims to reduce its energy consumption by about 99.9% in 2022 by shifting from a Proof of Work to a Proof of Stake consensus algorithm, just like several other projects have done. Proof of Stake will demand miners to show how much of a currency they have locked up to boost their odds of being selected to be the validator. In theory, this will lower the amount of energy needed to validate each transaction.

Another impactful yet challenging idea is to move the Bitcoin operations next to oil fields and wind farms, thereby using all their excess energy.


As highlighted earlier, there are many projects powered by blockchain technology to control climate change. Admittedly, utilizing this technology is quite challenging; however, with the correct use, blockchain technology can help preserve our mother earth, which should be our priority in any case. With our Full Stack Web Development with Web 3 program, you can contribute to making blockchain technology a positive influence on the environment.

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