Travel
Costa living
Biologist Neel Zaver shares three projects in Costa Rica that offer hope in a time of crisis
2 October 2024
This article first appeared in our Earth Day 2025 issue of My Green Pod Magazine, published 22 April. Click here to subscribe to our digital edition and get each issue delivered straight to your inbox
When Bitcoin surged past $67,000 in late 2024, its supporters celebrated a new era of digital finance.
But beneath the euphoria lies a sobering reality: cryptocurrency’s energy appetite now rivals entire nations.
Bitcoin alone consumes more electricity annually than Poland or Argentina, emitting 65 megatons of CO² – equivalent to the annual footprint of Greece.
This paradox pits groundbreaking financial innovation against an escalating environmental crisis – yet the story of crypto’s sustainability isn’t black and white.
From energy-efficient blockchains to solar-powered tokens, the industry is forging paths towards greener solutions – but can they outpace the damage?
Bitcoin’s environmental toll stems from its ‘proof-of-work’ (PoW) system, where miners solve cryptographic puzzles to validate transactions. This process, while secure, demands staggering computational power.
In 2024, the Bitcoin network devoured 172 terawatt-hours of electricity – enough to power 16 million US homes for a year.
To put this in perspective, a single Bitcoin transaction guzzles 16,000 litres of water, which is comparable with filling a backyard swimming pool.
The geographical spread of mining exacerbates the issue. After China banned crypto mining in 2021, operations shifted to fossil fuel-heavy regions like Kazakhstan and Texas.
In the US, Bitcoin mining now accounts for 0.6% of national electricity demand, straining grids during heatwaves and increasing reliance on coal.
Critics argue this undermines global climate goals: if Bitcoin were a country, its emissions would rank 27th worldwide.
Not all cryptocurrencies follow Bitcoin’s energy-intensive model. Newer blockchains like Ethereum have adopted ‘proof-of-stake’ (PoS), a system replacing competitive mining with token ownership stakes.
This shift slashed Ethereum’s energy use by 99.99%, reducing its annual consumption from 2.44 gigawatts to a mere 224 kilowatts – akin to powering 600 US homes, rather than a mid-sized nation.
Projects like Cardano and Tezos also use PoS, consuming less energy per transaction than a Google search.
Solana, another eco contender, processes 2,000 transactions per second with a carbon footprint 99% smaller than Bitcoin’s.
These innovations highlight a critical truth: blockchain technology itself isn’t the enemy. The problem lies in outdated consensus mechanisms.
Beyond efficiency upgrades, some cryptocurrencies directly tackle environmental challenges.
SolarCoin rewards solar energy producers with coins for every megawatt-hour generated. The goal is to accelerate the clean energy transition by linking crypto incentives to renewable infrastructure.
Platforms like KlimaDAO tokenise carbon offsets, allowing users to trade verified emission reductions on blockchain. Each token represents one tonne of sequestered CO², creating a transparent market for climate action.
The Crypto Climate Accord, backed by 250 firms, pledges to achieve net zero emissions for the crypto sector by 2040. Initiatives include funding reforestation in the Amazon and coral reef restoration using blockchain-tracked donations.
Despite progress, hurdles remain. Bitcoin still dominates 45% of the crypto market, and its mining sector relies on coal for 45% of electricity.
Even ‘green’ projects face scrutiny: Chia, a crypto that uses hard-drive storage instead of mining, saw its value plummet amid concerns over e-waste from specialised hardware.
Regulatory gaps further complicate matters; while the EU mandates emissions reporting for crypto firms, the US and Asia lack cohesive policies.
‘Without global standards, greenwashing risks undermining genuine sustainability efforts’, warns climate economist Murat Kucukvar.
The crypto industry stands at a crossroads. Ethereum’s successful PoS transition proves that radical change is possible, but Bitcoin’s resistance highlights entrenched interests.
Renewable energy offers a partial fix – El Salvador powers its Bitcoin mining with volcanic geothermal energy – yet experts stress that curbing demand is equally vital.
For consumers, the choice matters. Opting for low-energy cryptos like Algorand or supporting carbon-neutral platforms can drive market shifts.
Meanwhile, developers are exploring ‘green mining’ innovations, such as repurposing excess heat from data centres for residential heating – a practice piloted in Sweden.
The conclusion? Cryptocurrency’s environmental toll is undeniable, but its potential to revolutionise finance and climate action is equally real.
The key lies in adopting blockchain’s efficiency without replicating Bitcoin’s waste.
As SolarCoin founder Nick Gogerty notes, ‘Crypto isn’t inherently good or bad – it’s a tool. We can either build a future where digital finance accelerates the climate crisis or one where it helps solve it.’
ABOUT NEEL ZAVER
Neel Zaver is a biologist and creative who is using his work to showcase the inspiring work of organisations around the world for the environment, conservation and our planet. His goal is to instil hope by profiling those working to create a positive future for us all.
Biologist Neel Zaver shares three projects in Costa Rica that offer hope in a time of crisis
Communities up and down the UK are being empowered to invest in positive social and environmental change.
Now you can move your money with effortless switches that benefit the planet and your pocket.
UK consumers urge banks to invest in long-term sustainable change in light of cost of living and climate crises.
Subscribe to our newsletter
Weekly ethical news, offers, comps and a free digital mag (quarterly) – what’s not to love?
