The Biden administration will draught a report on cryptocurrency miners’ energy use and emissions.
According to Bloomberg Law, the White House’s energy team is producing a policy recommendations report to address concerns about bitcoin mining’s energy usage and emissions. After US President Joe Biden issued the executive order in March, the policy report, which is scheduled in August, might be one of the first case studies of the impact of mining. Costa Samaras, the White House Office of Science and Technology Policy’s principal assistant director for energy, told Bloomberg Law. The goal of the report is to look into all claims made about the cryptocurrency mining sector, including claims that mining may benefit society. At the same time, assertions that crypto mining is a local annoyance and a climate calamity are made. The energy team will also look at suggestions that mining farms can provide flexibility to electrical grid operators by agreeing to shut down when demand increases, according to Samaras. Local noise pollution and the energy efficiency of distinct consensus approaches — proof-of-work (PoW) versus proof-of-stake — are also part of the study’s scope (PoS).
The process of confirming transactions and adding them to the blockchain is known as cryptocurrency mining. The PoW mining technique necessitates the use of computers to solve complex computational problems, which necessitates the use of electricity. As a result, it consumes over 99 percent more energy than PoS. The need for electricity in the crypto business has increased 20-fold in the last five years, according to a Bloomberg Law article. According to the Cambridge Bitcoin Electricity Consumption Index, bitcoin mining consumes more electricity per year than countries like Finland or Pakistan. The increased demand for electricity puts further strain on the already overburdened electricity industry. Extreme weather, old lines, a transition to renewable energy, and demand from the electric vehicle sector are all causing problems for the electrical sector. It’s unclear whether the report’s recommendations will result in any policy changes. Some believe, however, that the federal government may require miners to report their energy use and emissions to investors, who may then pressure miners to clean up.
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