Remember when Elon Musk used to be one of Bitcoin's biggest proponents? It sure seemed that way. One could even purchase Tesla vehicles using Bitcoin. Then, something changed in May 2021.
At that point in time, Musk stated that Tesla would no longer accept Bitcoin. Why? Over climate concerns. To those not oriented, they may have been scratching their heads. What was the connection between Bitcoin and climate change?
Bitcoin is said to rely on something called PoW. Not a Prisoner of War, but a Proof of Work, which is, basically, an algorithm that requires miners to solve complex puzzles for transactions to be validated. It sounds cool and very National Treasure-y, but this is something that requires a lot of computational power, consuming a lot of electricity. It's so substantial that just Bitcoin is said to consume more electricity than a couple of countries, including Norway. That might leave a dinosaur-sized carbon footprint, especially if that electricity comes from fossil fuels. On top of needing a lot of electricity for crypto mining equipment, there are said to be cooling systems required to prevent overheating.
So, has that been the stone in crypto's shoe? Not as green as Greta Thunberg would like? Because crypto is something that has been lauded as a phenomenon that could revolutionize finance by decentralizing transactions. But, could crypto be greened? Or could its environmental impact be reduced?
