The incoming mayor of New York City thinks cryptocurrency and blockchain technology are the future. Eric Adams has advocated to reshape the city into a crypto hotspot, with crypto being taught in schools. He also plans to take his first three paychecks in bitcoin payment.
Adams said in an interview that bitcoin was the “new way of paying for goods and services throughout the entire globe” and that schools “must” teach the technology behind it, as well as “this new way of thinking”.
He’s not alone in America. The mayor of Miami announced in February that the city plans to accept tax payments in bitcoin and let employees draw their salary in the cryptocurrency. Crypto conferences like Bitcoin 2021 – billed as the biggest bitcoin event in history – have chosen Miami as their host city because the area has rolled out the red carpet for this industry.
But not everyone is onboard with the crypto giddiness being expressed by America’s political class. Mining cryptocurrency is notoriously environmentally unfriendly, and in an era of rapid climate crisis, increasing the use of the technology could be hazardous.
According to Digiconomist, a single bitcoin transaction uses the same amount of power that the average American household consumes in a month – which equals roughly a million times more in carbon emissions than a single credit card transaction. And globally, the carbon footprint of bitcoin mining is greater than that of the United Arab Emirates and falls just below the Netherlands’.
People should be concerned about the environmental and climate impacts of “proof-of-work” cryptocurrency mining such as bitcoin, said Benjamin A Jones, an economist at the University of New Mexico.
The mayor-elect of New York City, Eric Adams, is an enthusiastic supporter of cryptocurrency. Photograph: Timothy A Clary/AFP/Getty Images
Such currencies require miners to compete to validate transactions on their blockchains, and that takes enormous, power-hungry servers. Bitcoin mining uses energy predominantly generated from fossil fuels, which creates air pollution and carbon emissions, said Jones.
“These pollution emissions are harmful to human health outcomes and the carbon emissions lead to climate damages,” he added.
Jones recently co-authored a paper that estimated that in 2018 each $1 of bitcoin value created was associated with $0.49 in health and climate damages in the US – meaning that the negative human health costs and climate impacts of bitcoin mining in the US were roughly half as large as the per-coin value.
“This is a tremendous negative externality of bitcoin mining that is imposing significant societal costs on all of …….