I’ve long said that Ripple (and XRP) shouldn’t be compared to Bitcoin as they are two entirely
different beasts, however, I felt that another dissimilarity should be addressed, which is, the massive
amounts of energy required to mine Bitcoin and the environmental impact.
Let’s begin by explaining what “mining Bitcoin” is. In its simplest form, mining is the process by
which Bitcoin transactions are validated and as a reward, the “miner” is awarded some Bitcoin. To
explain a bit further:
Around every ten minutes, mining computers collect a block (which consist of approximately a few
hundred Bitcoin transactions) and turns it into a mathematical puzzle. Then the miners get to work
to solve the puzzle and the first one to solve it, announces it to the network. At this point, other
miners validate the accuracy and if enough agree to it, it gets cryptographically added to the
blockchain. Once 99 blocks have been added to the ledger, the miner then gets the payout. A more
in-depth description can be found here.
Is Bitcoin scalable? It is if one refers to the amount of energy required to keep mining as well as
producing more coins. Last year, around 32 terawatts of energy were used, which is enough
electricity to power 3 million US households. Visa, by comparison, and their billions of transaction
verifications, uses enough power for 50,000 US households. The problem doesn’t end here though,
as Bitcoin grows, the math problems get even more complex, and it’s estimated by mid-2019, the
energy consumption will be enough to power THE ENTIRE UNITED STATES OF AMERICA.
Why am I shouting this fact? I’ll tell you.
I’ve been fortunate enough to live and work all around the world, and up until a couple of years ago,
was based in South China (for 8 years). Living in Shenzhen, in Guangdong province, put me in the
heart of China’s manufacturing engine along the Pearl River Delta. The pollution caused from this
industry by coal fired factories is immense, so immense, the air quality is diminished to a level that
sometimes, depending on the wind, one cannot see more than a couple hundred meters.
When we talk about the power requirement for both current and future Bitcoin mining, it’s easy to
imagine how terrible the air quality will become as these power factories are mostly coal fired. The
way it stands now, most of these factories are in remote locations, close to the power being
generated, such as Inner Mongolia. One may think “oh, that’s far away, out of sight, and out of
mind” but it’s not that easy. Studies have shown that this pollution is crossing the Pacific and already
impacts the west coast of the USA.
There have been news reports about China cracking down on Bitcoin farms, which is good news as
far as pollution goes, however, Bitmain, one of China’s largest Bitcoin miners, is looking to expand to
Quebec, Canada, and even Switzerland. For anyone who’s ever visited these areas will know, these
are some of the most pristine and beautiful locations on Earth.
What will happen to our already suffering planet if these plans come to fruition?
So let’s now talk about the environmental impact of mining XRP. This will be a very short sentence,
because, there is virtually none.
Ripple validates via nodes and the power consumption is like that of a mail server, and all the coins
have been pre-mined already. It really is just that short and simple. It has been said before that
Ripple’s XRP is the most Green Currency and it’s certainly a concept I myself can get behind.
We talk about different nations adoption of green technologies, and ways to fight climate change,
the ongoing mining industry of Bitcoin should not be allowed to continue in its current form. I take
my hat off to China for realising this (China is indeed trying to fight pollution) and stepping up in a
reactive as well as somewhat proactive way to make a change. I only hope that other nations will
follow suit from a proactive approach to focus on green industries that doesn’t include Bitcoin
Disclaimer: I personally own XRP digital assets and am a long-term investor/holder in the product.
Author: Andrew French (Twitter @asiamtm)