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The fragile balance between technological advancements and preserving our planet has emerged as one of the most pressing challenges of our time. With environmental protection and combating climate change at the forefront of global concerns, seeking innovative solutions to reconcile technological progress and sustainability is crucial. However, Web 3.0 technologies such as blockchain have to face challenges in terms of energy consumption and carbon footprint, demanding alternatives to reduce their environmental impact. Although promising solutions exist in this regard, many challenges remain.

Blockchains, especially Bitcoin and first-generation ones, present significant environmental challenges due to their high energy consumption and considerable carbon footprint. This stems from their reliance on the Proof of Work (PoW) mechanism, where miners use their machines’ computing power to solve complex mathematical problems and validate transactions. The system requires a substantial amount of energy, as the energy consumption is aggregated among all participants, in addition to that of the miner who successfully solves the puzzle. Computing power being a limited resource, miners seek to improve their computers’ performance in this competitive environment. Consequently, this race to solve puzzles, combined with the increasing number of miners, leads to a significant rise in energy consumption. For example, in 2023, Bitcoin network’s electricity consumption exceeded that of Sweden. This activity results in high carbon emissions, exacerbated by the growing number of transactions to verify as a cryptocurrency’s popularity increases.

Cryptocurrency mining also impacts water and land resources, as mining farms require significant amounts of water to cool machines and humidify the air. Thus, while some parts of mining are powered by renewable energies, the majority of electricity used comes from non-renewable sources, amplifying the environmental impact of this energy-intensive activity.

Technological Alternatives Mitigating Blockchain’s Environmental Impact

An emerging solution to reduce this energy challenge is transitioning from Proof of Work to Proof of Stake (PoS). In this protocol, supported by Greenpeace and other collectives, cryptocurrency holders lock assets in a wallet to participate in a blockchain network’s operations, incentivized to hold more tokens to increase their chances of selection. Unlike PoW, which requires significant computing power, PoS uses tokens as a resource, avoiding investment in expensive hardware and significantly reducing energy consumption. For instance, The Merge, also known as Ethereum 2.0, has adopted PoS, reducing Ethereum network’s energy consumption used for securing the network by 99.9%.

PoS is not the only emerging protocol aiming to reduce environmental impact. Proof of Behavior (PoB) is notably used to create the EcoMobiCoin cryptocurrency, made possible by demonstrating an individual’s environmentally responsible behavior in citizen mobility.

Furthermore, the increasing use of renewable energies, such as hydroelectricity, solar, and wind power, reduces carbon emissions associated with cryptocurrency mining, making this practice more sustainable and environmentally friendly.

Rise of Ecological Initiatives

Green initiatives such as the Crypto Climate Accord, inspired by the Paris Agreement, seek to accelerate the development of digital solutions to address the considerable environmental impact of cryptocurrencies. The Zumo initiative, part of this accord, aims to decarbonize the cryptocurrency and blockchain industry to achieve zero carbon emissions by 2030, promoting the use of renewable energy sources in the mining process.

Other innovative initiatives are also emerging. For example, MintGreen’s project aims to recycle heat from Bitcoin mines to heat cities, as North Vancouver has been doing since 2022. This innovative approach aims to reduce CO2 emissions by reusing up to 96% of the energy generated by mining to heat buildings.

Additionally, the Greenercoin blockchain offers solutions to offset carbon footprint by using GNC tokens supported by zero-carbon validators, thereby reducing issues related to high energy consumption and non-clean energy use.

“Green” cryptocurrencies have also emerged, such as SolarCoin, which promotes solar energy production using Proof of Stake and solar energy to create cryptocurrency. Similarly, IMPT.io allows the use of carbon credits to support environmental and ecological projects. Moreover, Near Protocol, a rising blockchain initiative, uses Proof of Stake and sharding for better energy efficiency, generating 200,000 times less CO2 annually than Bitcoin.

Legal Void in the Field

Faced with the increasing energy consumption due to cryptocurrency mining, countries like China and Sweden have reacted by strengthening their policies regarding this practice. China, historically a leader in this field, banned mining in 2021 due to its environmental repercussions, leading to the closure of many mining centers. Simultaneously, the growing attention to the ecological implications of blockchains has prompted the United Nations to promote sector actors to take climate action, with notable participation in COP28 in 2023.

However, while the MiCA (Markets in Crypto-Assets) regulation aims to regulate crypto-asset markets in Europe, there is currently no comprehensive regulatory framework on a large scale that regulates the environmental impact of blockchain and cryptocurrencies. As these technologies continue to develop, appropriate regulation could encourage sector actors to assume greater responsibility while preserving innovation and economic development.

Ultimately, new technologies, especially in the field of blockchains and cryptocurrencies, represent both a problem and a solution to environmental challenges.

Lucie Speyser 

Master 2 Cyberjustice – Promotion 2023-2024

Sources : 

Carbo Academy – L’impact environnemental de la cryptomonnaie.

Cointribune – Ferme de minage crypto : Qu’est-ce que c’est ?

Ethereum Proof-of-stake : ce que les holders doivent savoir

Les meilleures crypto-monnaies écologiques à acheter en 2024

La Blockchain verte, un outil pour mesurer l’impact écologique du luxe

COP28 : Des projets de blockchain pour décentraliser les marchés climatiques

Nouveau : à North Vancouver on utilise l’énergie de la cryptomonnaie comme chauffage

A propos de Lucie SPEYSER

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