Carbon footprint of global Bitcoin mining: emissions beyond borders

Abstract

Executing a single Bitcoin transaction equates approximately to the greenhouse gas emissions of a moderate-sized electric or gasoline engine sedan vehicle traveling between 1600 and 2600 km. This research undertakes an examination of Bitcoin's real climate problem and presents a novel framework and an in-depth analysis of Bitcoin mining's carbon footprints based on country-specific, per transaction, and per total hashes required for mining a block. In addition, it maps the carbon footprints of global supply chains inherent in Bitcoin mining operations. We propose a life cycle assessment-based multination carbon footprint accounting method, allowing us to map both direct and indirect carbon footprints across various regional and global supply chain sectors. The findings show that approximately 50% of global emissions from Bitcoin mining are confined within the territorial boundaries of the USA. Meanwhile, China, despite its regulatory restrictions on mining, continues to play a significant role as both a major contributor to global mining emissions and a leading manufacturer and supplier of Bitcoin mining equipment. The globalized nature of Bitcoin's supply chain suggests that localized efforts to reduce carbon emissions may fall short of addressing the full scope of the problem. For instance, while Norway's domestic emissions from Bitcoin mining are low due to its use of renewable energy, a significant share of its emissions stems from its global supply chain, particularly from China. The findings underscore the necessity for carbon footprint reduction policies and management strategies that transcend national borders, emphasizing the importance of accounting for emissions embedded in global trade and supply chains. This research contributes to the broader discourse on sustainable cryptocurrency practices by highlighting the imperative need of a globally coordinated approach to carbon footprint management in Bitcoin mining.