Written Question: Environmental harm caused by energy use of cryptocurrency

(Source: European Parliament)

Date submitted: 3 March 2021

Question for written answer E-001249/2021
to the Commission
Rule 138
Clare Daly (The Left), Mick Wallace (The Left)

Subject: Environmental harm caused by energy use of cryptocurrency

In its answer to Written Question E-002367-2019, the Commission implied that the energy cost of cryptocurrencies must be weighed against their benefits. The energy cost of the Bitcoin network is now more than that of Argentina, a country of 45 million people(1). The carbon footprint of cryptocurrency is of increasing concern for the future of our planet.

While with a centralised digital currency, a transaction might need to be processed only once, centrally, with a decentralised, proof-of-work cryptocurrency, every transaction must be processed by every validating node participating in that currency. This distributed model buys trustless and anonymous currency transactions for users, at the cost of expending massive amounts of energy processing each transaction perhaps hundreds of thousands of times redundantly. This trade-off is responsible for the exorbitant energy cost of leading cryptocurrencies.

  1. Is it the Commission’s position that trustless and anonymous payments – outside the reach of state control and financial surveillance – are of sufficient social benefit that they are worth the energy costs of a country of 45 million people or more, and the associated environmental harm?
  2. Will the Commission take action to stop the irreversible damage being done to the natural environment by this technology?

(1) https://www.bbc.com/news/technology-56012952

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