How Bitcoin “drinks" our water. Learn about the water value of cryptocurrencies.
A single Bitcoin transaction can use as much water as it takes to fill a home pool. Financial expert Alex de Vries, a graduate student at the Free University of Amsterdam, presented the first comprehensive assessment of Bitcoin's water consumption in an article in the journal Cell Reports Sustainability. He warns that without restrictions, Bitcoin activities can affect drinking water, especially in countries already suffering from water scarcity, including the United States.
De Vries points to a growing problem: "Many regions of the world are experiencing drought, and fresh water is becoming an increasingly scarce resource. If we continue to use this valuable resource for useless calculations, it will be really painful." Previously, research on cryptocurrencies focused mainly on electricity consumption. When mining Bitcoin, the most popular cryptocurrency, miners from all over the world actually compete in solving mathematical problems on the Internet, and the winners receive a portion of the cost of Bitcoin. On the Bitcoin network, miners make about 350 quintillion — that's 350 with 18 zeros-guesses every second, which requires a huge amount of computing power.
De Vries notes: "The correct answer appears every 10 minutes, and the remaining data, quintillions of them, are calculations that serve no further purpose and are therefore immediately discarded." The process also uses large amounts of water to cool computers in large data centers. Based on data from previous studies, de Vries estimates that Bitcoin mining consumes between 8.6 and 35.1 gigalitres of water per year in the US. In addition to cooling computers, coal-and gas-fired power plants that provide electricity for computers also use water to lower the temperature. This cooling water evaporates and cannot be reused. Water evaporated from hydroelectric power plants also increases the water footprint of Bitcoin's electricity demand.
Overall, de Vries estimates that Bitcoin mining consumed more than 1,600 gigalitres of water worldwide in 2021. Each transaction on the Bitcoin blockchain uses an average of 16,000 liters of water, which is about 6.2 million times more than when paying with a credit card, or enough to fill a home pool. Bitcoin's water consumption is expected to increase to 2,300 gigalitres in 2023, de Vries says.
In the US, Bitcoin mining consumes between 93 and 120 gigalitres of water per year, which is equivalent to the average water consumption of 300,000 American households or a city like Washington. "The price of Bitcoin has recently increased and reached its highest point in a year, despite the recent decline of several cryptocurrency platforms. This will have serious consequences, because the higher the price, the higher the environmental damage," says de Vries.
"The most painful thing about cryptocurrency mining is that it uses so much computing power and resources, but these resources are not used to create any model, for example, artificial intelligence, which could be used for something else. It's just useless calculations." At a cost of over $ 37,000 per coin, Bitcoin continues to expand globally. In Central Asian countries, where the dry climate is already putting pressure on freshwater supplies, increased Bitcoin mining activity will exacerbate the problem. In Kazakhstan, a global cryptocurrency mining hub, Bitcoin transactions consumed 997.9 gigalitres of water in 2021. The country is already facing a water crisis, and the growing water footprint from Bitcoin mining could worsen the shortage.
De Vries suggests approaches, such as changing the Bitcoin mining software, that can reduce the electricity and water consumption for this process. The inclusion of non-water-based renewable energy sources, including wind and solar, can also reduce water consumption. "But do you really want to spend wind and solar energy on crypto? In many countries, including the United States, the amount of renewable energy is limited. Sure, you can move some of these renewable energy sources to crypto, but that means something else will run on fossil fuels. I'm not sure how much you'll actually win," he says.
A single Bitcoin transaction can use as much water as it takes to fill a home pool. Financial expert Alex de Vries, a graduate student at the Free University of Amsterdam, presented the first comprehensive assessment of Bitcoin's water consumption in an article in the journal Cell Reports Sustainability. He warns that without restrictions, Bitcoin activities can affect drinking water, especially in countries already suffering from water scarcity, including the United States.
De Vries points to a growing problem: "Many regions of the world are experiencing drought, and fresh water is becoming an increasingly scarce resource. If we continue to use this valuable resource for useless calculations, it will be really painful." Previously, research on cryptocurrencies focused mainly on electricity consumption. When mining Bitcoin, the most popular cryptocurrency, miners from all over the world actually compete in solving mathematical problems on the Internet, and the winners receive a portion of the cost of Bitcoin. On the Bitcoin network, miners make about 350 quintillion — that's 350 with 18 zeros-guesses every second, which requires a huge amount of computing power.
De Vries notes: "The correct answer appears every 10 minutes, and the remaining data, quintillions of them, are calculations that serve no further purpose and are therefore immediately discarded." The process also uses large amounts of water to cool computers in large data centers. Based on data from previous studies, de Vries estimates that Bitcoin mining consumes between 8.6 and 35.1 gigalitres of water per year in the US. In addition to cooling computers, coal-and gas-fired power plants that provide electricity for computers also use water to lower the temperature. This cooling water evaporates and cannot be reused. Water evaporated from hydroelectric power plants also increases the water footprint of Bitcoin's electricity demand.
Overall, de Vries estimates that Bitcoin mining consumed more than 1,600 gigalitres of water worldwide in 2021. Each transaction on the Bitcoin blockchain uses an average of 16,000 liters of water, which is about 6.2 million times more than when paying with a credit card, or enough to fill a home pool. Bitcoin's water consumption is expected to increase to 2,300 gigalitres in 2023, de Vries says.
In the US, Bitcoin mining consumes between 93 and 120 gigalitres of water per year, which is equivalent to the average water consumption of 300,000 American households or a city like Washington. "The price of Bitcoin has recently increased and reached its highest point in a year, despite the recent decline of several cryptocurrency platforms. This will have serious consequences, because the higher the price, the higher the environmental damage," says de Vries.
"The most painful thing about cryptocurrency mining is that it uses so much computing power and resources, but these resources are not used to create any model, for example, artificial intelligence, which could be used for something else. It's just useless calculations." At a cost of over $ 37,000 per coin, Bitcoin continues to expand globally. In Central Asian countries, where the dry climate is already putting pressure on freshwater supplies, increased Bitcoin mining activity will exacerbate the problem. In Kazakhstan, a global cryptocurrency mining hub, Bitcoin transactions consumed 997.9 gigalitres of water in 2021. The country is already facing a water crisis, and the growing water footprint from Bitcoin mining could worsen the shortage.
De Vries suggests approaches, such as changing the Bitcoin mining software, that can reduce the electricity and water consumption for this process. The inclusion of non-water-based renewable energy sources, including wind and solar, can also reduce water consumption. "But do you really want to spend wind and solar energy on crypto? In many countries, including the United States, the amount of renewable energy is limited. Sure, you can move some of these renewable energy sources to crypto, but that means something else will run on fossil fuels. I'm not sure how much you'll actually win," he says.
