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What Is Cryptocurrency’s Environmental Impact?
Cryptocurrencies have come a long way since their inauspicious beginnings. While the conventional financial sector initially dismissed digital currencies as a tool for criminals and speculators, the industry has made great strides toward establishing itself as a genuine and (possibly) world-changing arena.
Bitcoin (BTC) and Ethereum (ETH) have experienced significant price and user growth, but there are still concerns about the long-term effects of broad cryptocurrency use. Many skeptics and environmentalists, in particular, have expressed worry about bitcoin mining, which may consume vast quantities of electricity.
Why Mining Requires Energy
Because of the competitive nature of proof-of-work (PoW) blockchains, these enormous energy costs exist. Rather of keeping account balances in a centralized database, bitcoin transactions are recorded by a distributed network of miners and rewarded with block rewards. These specialized computers are in a race to record and certify new blocks, which can only be generated by solving cryptographic challenges.
Cryptocurrency supporters claim that because it does not rely on a trusted middleman or a single point of failure, this system offers several benefits over centralized currencies. However, the mathematical difficulties for mining…
