Bitcoin and other PoW coins are an ESG nightmare
(Feb 14, 2021)Abstract
This paper looks at the energy consumption of seven proof-of-work-based anarchic (public) blockchains such as Bitcoin and Ethereum. By using a hashrate division method – similar to the Cambridge Bitcoin Electricity Consumption Index – a lower bound and upper bound of mining hardware are provided. Based on this method we are able to show that proof-of-work chains continue to consume resources in direct proportion to the underlying coin value. Due to the rapid increase in coin value, proof-of-work-related activities – such as semiconductor manufacturing – are once again squeezing supply chains and retail channels, crowding out socially productive goods and services from entering the marketplace.