Conversation

1) Ok, so how much CO2 does BTC actually create? How much of a worry is it?

Quote Tweet

1) So on energy usage of BTC: The profile will change long-term. Right now the main driver is from block rewards. But as block rewards exponentially decay, those will become less relevant. Long-term, there are really two core drivers.

Show this thread

58

271

1,077

2) NOT... advice, really. Just math.

1

5

103

3) Ok, so. Let's say you spend $X on BTC/ETH blockchain fees (or any PoW currency). Those $X are going to miners in a bidding war for block slots. In an efficient market, as long as it's profitable to run a BTC/ETH mining rig, more people will open them up.

3

5

99

4) So in equilibrium, it should be a bit above breakeven: if they're paid $X, they must have < $X of total expenses. So gas fees ~ 1.5 * mining costs. mining costs are 1/2 electricity 1/2 machines, which take electricity. So 3/4 * mining costs ~ $ spent on electricity.

3

5

89

5) Something like 1/3 of mining rigs run on renewable electricity, so dirty electricity ~ 2/3 * $ spent on electricity. Electricity that miners use costs ~$0.05 / kWh. Each kWh of dirty electricity produces about 0.0004 tons of CO2.

8:32 PM · May 20, 2021Twitter Web App

Replying to

6) Finally, how bad is one ton of CO2? Well, givingwhatwecan.org/report/cool-ea estimates about $1 to reduce CO2 emissions by 1 ton.

5

10

97

7) Ok, so putting it all together.... a) $x in gas b) * 2/3 --> in mining cost c) * 3/4 --> electricity d) * 2/3--> dirty electricity e) / $0.05 --> kWh f) * 0.0004 --> tons of CO2 g) * $1 --> cost to offset 2/3 * 3/4 * 2/3 / 0.05 * 0.0004 * 1 = 0.0026

8

15

226

8) So this implies, with large error bars: If, for every $1 you spend on gas/blockchain fees, you donate $0.0026 to Cool Earth, you'll be roughly carbon neutral.

-- does this seem right? If so, I think the environmental worries about BTC are pretty easily offset!

90

179

1,285

Lord of BTC (don't hate ETH)

Replying to

and

Great analysis, though I have a question about the 0.0004 tons of CO2/kWh According to eia.gov/tools/faqs/faq, it is 2.21lb/kWh for coal, and 0.91lb/kWh for natural gas. This would be 0.00100 or 0.00041, respectively, but presumably a lot more coal is being used bc it's cheaper

1

1

Replying to

fair! It could totally be off by a factor of 3.

3

Replying to

and

5 cents is very high for the big farms. 2/2.5 cents for power agreements

Replying to

and

You are forgetting about the "red queen" race argument that sophie of google brought up... its valid but overall the amount of expenditure on bitcoin mining will be exponential because it is rational strategy compared to any other rational decision to spend funds in corporations.

1

Show additional replies, including those that may contain offensive content

Show