Bitcoin is expected to become the first monetary system to reach net zero emissions by 2024
Bitcoin (BTC) continues to receive criticism over its carbon footprint as the assets register heavy adoption in various jurisdictions. However, the situation may change, especially as mining operators increasingly choose renewable energy sources in an effort to reduce carbon emissions.
In particular, Bitcoin is set to achieve net zero emissions by December 2024, becoming the first monetary system to achieve this feat, a new study by bitcoins Indicates.
According to the study, the Bitcoin network currently has 62.4% zero emissions by taking carbon negative mining into account. By March 2023, the activity is expected to have 72.7% zero emissions based on newly announced projects that are carbon negative.
According to the methodology, the researchers calculated the amount of bitcoin energy emitted from the positive carbon sources and then extracted the amount of positive carbon. Additionally, the researchers reverse-engineered to calculate how much methane would have to be removed from the air through combustion to balance out the amount of negative carbon.
Bitcoin’s path to carbon neutral
The conclusions of the study are based on the use of flared gas to power bitcoin mining, which has been growing at an average of 8.3 megawatts per month since May 2021.
“We expect bitcoin to be mined with blown methane as energy will initially grow at just 83% of the flared gas mining growth rate (6.9 megawatts/mo). Based on the more modest growth rate, we expect the bitcoin network to become carbon neutral in Q4 2024 in full.
Moreover, the analysis acknowledged that the hash rate is likely to increase along with energy consumption as Bitcoin grows. However, the study indicated that renewable grid usage and mining efficiency are also on the rise and will provide a counterbalance to the hash rate.
Overall, Bitcoin’s carbon footprint has come under scrutiny from various jurisdictions, with the topic becoming a regulatory focus. For example, the White House commissioned a study to determine the energy consumption of bitcoin and cryptocurrencies to influence the country’s regulatory policy.
At the same time, various mining companies are increasingly turning to renewable sources to reduce the impact of their carbon footprint.
In this line, as Finbold reported on August 9, the demand for electricity by Bitcoin has fallen by 21% since the beginning of the year. Notably, the drop coincided with the ongoing crash in the cryptocurrency market.
However, it will be interesting to watch how the zero net bitcoin emissions impact the regulatory side. This comes as jurisdictions like New York have banned the creation of new Proof of Work (PoW) mining activities.