Mining cryptocurrency such as bitcoin and Ethereum with computers and dedicated mining machines is not news anymore since the price of cryptocurrencies skyrocketed in the past few years. It is not even new for the general public to use personal computers to mine. You don’t have to be a geek to hear about the hype for cryptocurrencies and the insane shortage of graphics cards.
Besides their popularity, they received mixed reviews from celebrities and the governments. A tweet from Elon Musk could send the price of a cryptocurrency into space. On the other side of the world, though, cryptocurrencies and miners ran out of luck. China has just banned cryptocurrencies and their entirety. Mining, trading, and platforms are all deemed illegal. There are rumors on the internet saying that the enforcement agencies are currently tracking down any illegal mining activities. This is not particularly difficult to do since internet connectivity is required for mining, and no one can truly hide on the internet. Many college students claim that they have received warnings from their universities for mining with their laptops. However, some suspect that large illegal miners could be colluded with corrupted local governments due to high profitability.
One of the main reasons the Chinese government wants to ban cryptocurrencies is that mining takes a lot of power. It is estimated that illegal mining activities in Sichuan province alone will consume 11.3 TWh in 2021, which is enough to power the entire Champaign County for five years. Sichuan province is rich in hydroelectricity, but many other regions do not. The majority of the electricity generated in China is by coal. Thus, eliminating mining activities is crucial to reduce coal consumption.
Since trading cryptocurrency is “anonymous” and was in a grey zone to begin with, it did not generate much tax at all. It was so unregulated that estimating tax numbers was difficult. Some estimated the tax collected by the Chinese government from the cryptocurrency industry in 2020, in a world where one bitcoin costs $50,000, was merely $350,000. Some miners even steal electricity or collude with small power plants to get electricity at a low cost, further aggravating the government’s loss.
On a global scale, cryptocurrency mining consumes a whopping 149 TWh per year. If cryptocurrency mining is a country, it will rank the 26th most power consumption country. What have cryptocurrencies created, though, except for bumping up graphics card sales? Nothing, compared to any traditional industries. They sure made some people richer, but others must have lost some because fortune isn’t created but rather transferred. The coins are just strings of numbers before someone buys them with real money. They are also used for illegal activities such as money laundering due to their anonymous characteristics.
The mining and trading of cryptocurrencies must be put to an end. The electricity wasted could have been put to manufacturing, charging electric cars, or simply reduced to save fossil fuel. Many powerful nations such as the US, China, and Australia generate less than 30% of their energy from renewable sources. Just like in the waste hierarchy, "reduce" is always in the first place. Reduce, whether the amount of fossil fuel used or the amount of greenhouse gases generated, is critical to a sustainable society of which cryptocurrencies do not worth being a part of.