On 8th February, Tesla bought $1.5 billion in bitcoin as it planned to accept bitcoin as payment. But on 13th May, Elon Musk tweeted that Tesla would discontinue accepting Bitcoin as payment due to its environmental concerns.
The world’s largest cryptocurrency, Bitcoin, fell 17% following Musk’s tweet.B
To understand the environment concerns we need to understand how new bitcoin is created?
Bitcoin Mining is a process of creating a new coin that involves using computers to solve complex mathematical algorithms or puzzles. This process ends up using a massive chunk of electricity as giant and powerful systems are used by miners to mine blocks and verify transactions. Mining for cryptocurrency often relies on electricity generated with fossil fuels like coal.
Bitcoin consumes more than 178 TWh annually, ranking it to the top 30 energy consumers if it were a country or equivalent to the annual carbon footprint of Argentina.
A single transaction of bitcoin has the same carbon footprint as 680,000 Visa transactions or 51,210 hours of watching YouTube.
If you enjoy reading such informative byte sized blog, consider subscribing to our newsletter to get exclusive content right in your inbox.