While I was in college, there was a lot of buzz around ‘cryptocurrency.’ Folks were not really sure if it would be a huge success, or just a fad. Cementing crypto as a joke was Dogecoin, a cryptocurrency based off of a meme. Any thoughts I had to invest were laughed off since this was just a fad.
Now in 2021, cryptocurrency has exploded in popularity thanks to many factors, but primarily the global pandemic. People realized that they could have their computers mine passively while they sleep. And honestly, if it had stayed at the scale I would be entirely for it. Why shouldn’t someone be able to make an extra $50, $100 a month with equipment they already have?
The problem, as always, comes down to people trying to squeeze just a little more than their competition. This is the core of capitalism. If you make $1 extra dollar this month, that’s because you were $1 smarter, $1 more efficient than your competition. There are few things not ruined by adding capital, and crypto isn’t one of them.
What’s the problem?
Cryptocurrency mining mimics real world mining; there has to be an extraction of resources. Instead of putting energy into gathering coal or oil, computers put energy into solving complex math equations. So computers have to constantly be running on electricity to mine. This wouldn’t necessarily be a problem if we produced all electricity sustainably…but here in PA we still are powered by coal. Which is why a Crypto Mining company buying a PA power plant is so troubling.
So instead of burning coal to keep our homes warm during the winter, provide lights to students studying…PA coal will be used to solve complex math equations.
On top of that, to make the computers needed to solve these equations we need certain materials out of the earth. The core component of a good mining rig is the same that makes a good gaming rig…a high end graphics card. I recently upgraded my PC, but the graphics card cost twice as much as normal due to low stock. What used to be a niche market has turned into low stock and high demand.
The ocean is on fire. The ice-caps are melting. Floods are destroying communities. There are major droughts around the world. AND NOW we need to solve another source of pollution? One created over the past five years? When does it end?
What’s the solution?
As I see it, and I’m no expert, there are three solutions.
There’s the Chinese approach to ban all mining and trading of cryptocurrency. Because banning something always means that it will never happen ever again.
A more realistic approach is to change the method of ‘mining.’ What if instead of consuming so much electricity, we find a different way to prove worth? For example, instead of energy intensive problem solving, people could earn crypto by keeping a portion of their storage free. While it would still use electricity to check on the amount of free storage space, it would be drastically less than what is used today.
Or we could analyze cryptomining as a whole. Is this really a solution we want for a global community? Is it really living up to the promise of decentralized currency? If we can somehow live on earth after solving the Climate Crisis, will there even be a purpose for cryptocurrency as a whole?