Bitcoin OGs are skeptical of a report released Wednesday by the Environmental Working Group (EWG) detailing how bitcoin miners are “polluting” communities in the United States.
The nonprofit group has documented through six case studies how the mining industry impacts Americans’ daily lives through air, water and noise pollution.
“The incessant noise generated by mining operations continues 24 hours a day, seven days a week, driving local residents to despair,” the report said specified. One of his case studies followed a couple in Cook County, Georgia, whose hearing was reportedly “damaged” thanks to one of the cases block streamnear bitcoin mining facilities.
Other case study focused on Stronghold Digital Mining in Venango Country, Pennsylvania. The company burns waste coal to power bitcoin mining machines, then spreads the leftover coal ash over land to be used as fertilizer. The EWG argued that the toxic pollutants in this ash fertilizer are carried into nearby rivers and streams when it rains, thereby polluting the water.
“What these mines have in common is the use of proof-of-work, which is inherently wasteful,” the report claimed, calling it “highly inefficient” to require large amounts of “fossil-fuel-generated electricity” to operate.
Proof of Work is a consensus mechanism used by Bitcoin and other decentralized blockchains that allows all network participants to agree on the sequential order of transactions while issuing new coins in a non-subjective way. Powerful computers compete in a race to construct Bitcoin’s next block of transactions by solving a complex math problem, and are rewarded with new BTC if they solve it first.
Many modern blockchains use an alternative consensus mechanism called Proof of Stake, which uses cryptocurrency instead of energy to secure the network. The EWG has long urged bitcoin developers to change their code and reduce energy consumption in a similar way, and supports another well-funded environmental campaign in addition.
However, prominent Bitcoin developers are not remotely interested in such a high-stakes protocol change. Blockstream CEO (and allegedly Bitcoin creator) Adam Back says energy cost of creating new bitcoin is necessary for it to function as money.
“People are buying digital gold to protect themselves from inflation and monetary erosion. Central banks are buying physical gold at a record pace for similar reasons,” he told Decrypt via Twitter. “Gold is analogously costly to mine, and that’s inherent in hard money as well.”
When asked by EWG about Blockstream’s noise pollution, Blockstream mining chief Chris Cook described the rig as “barely audible… crickets are definitely louder.”
Longtime bitcoin developer Luke Dash Jr. also denied that bitcoin is a source of environmental damage, arguing that the fiat currency system is much more harmful.
“PoW is actually good for the environment,” he told Decrypt via DM. “It makes clean energy like solar viable itself, where previously fossil fuels were typically needed to supplement it.”
Meanwhile, the developer dismissed Proof of Stake as a “scam,” citing a year 2015 essay Described the system as “unworkable”.
“By depending only on the resources within the system, Proof of Stake cannot be used to form distributed consensus as it depends on the story it is trying to form in order to enforce depreciation,” he explained Author of the report, Andrew Poelstra.
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