Bitcoin and its Environmental Impact

I was recently asked about how I felt about the environmental impact of virtual currencies, given that the energy required to mine the coins gets almost exponentially higher as fewer remain.

I don’t think for a minute that environmental impact will ever be the limiting factor in Bitcoin mining (I could wax lyrical on the human condition and its all-consuming need for power, to the detriment the environment, for paragraph after paragraph), and here’s an example of why.

GPU performance requirement for mining the remaining bitcoins is so high that it requires significant investment to make it feasible to do so. And that’s a continual investment, as it means replacing your GPU board each time a faster one is released. And that probably means you’ll need a new PSU into the bargain (the forthcoming Radeon R9 295X2 8 GB from AMD will be priced around the $1500 mark – no UK prices available as yet – and has an un-clocked power draw of 500W). So it’s no longer commercially viable for home users to mine what’s left, even with dedicated hardware (no more “I bought the hardware for gaming, and I mine overnight”). The hurdle is financial, and that finance is all Bitcoin-oriented.

So the scarcity of bitcoins requires increased processing, leads to increased investment, increased power consumption, and the inevitable increase in Environmental impact. Sadly it won’t be the environmental impact that will put people off mining (or make it problematical), it will only ever be the diminishing ROI that the necessary increase in more powerful hardware dictates.

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