White House Says Crypto Mining Threatens Zero-Carbon Strategy – And They’re Right_

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A recent report from the White House states that mining of cryptocurrencies such as Bitcoin may be outside of the nation’s climate change mitigation efforts. The Bitcoin community has reason to believe this is an attack on the cryptocurrency.

Biden administration on cryptocurrencies

The Biden administration is environmentally conscious and has said that crypto-assets could hinder US climate commitments and goals.

A report released on Thursday said the US needs to take steps to reduce the amount of pollution generated by crypto mining. The report suggested that the federal government gather more information on energy use with the states and the industry to standardize it.

A study to understand the environmental impact of cryptocurrencies was commissioned by President Joe Biden in early March of this year. The study appears to recognize proof of work as a problem and suggests changes to the regulatory framework surrounding it. Other federal agencies and offices are expected to provide some recommendations and reports to the US in the coming weeks. These recommendations will help the US decide how to deal with the asset class.

How bad are cryptocurrencies?

Cryptocurrencies must create new coins and use a mechanism to verify transactions on the network. Bitcoin and Ethereum use PoW and PoS consensus mechanisms, respectively, which use significant amounts of energy in the process. The Biden administration appears to oppose proof-of-work because of its high leverage, but bitcoin supporters believe it is a planned attack on the currency.

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Because the network’s high energy consumption is considered a problem, its energy consumption is a fraction compared to other digital entities such as YouTube. After all, the power consumption is justified because the network once held more than a trillion dollars in assets, and this continues just to show people’s faith in the currency.

Besides Bitcoin, other major networks don’t seem to be as threatened by the climate, instead adapting to more efficient approaches. Merge, a major software upgrade for the Ethereum network, will shift the blockchain to a less energy-intensive network and become a matter of credibility for cryptocurrencies.

But improving the efficiency of networks does not affect the scope of energy use crypto mining needs. 38% of the world’s Bitcoin mining takes place in the US alone. This figure is up from 3.5 percent a few years ago. Additionally, air, noise and water pollution due to crypto mining operations cannot be completely ignored. These facts present a case in favor of the White House- which seems to blame crypto for its negative impact on the environment.

New steps to solve problems

The White House plans to introduce new standards developed by federal agencies and the crypto industry, both working with states to reduce the crypto industry’s impact on the environment. Reducing noise generation and promoting the use of clean energy can be a few steps to take.

In addition, a series of reports will be sent to the president, which will explain the matter in more detail. Until then, crypto fans have no reason to panic.

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