The discussion on global warming returns to closely affect the world of cryptocurrency. Sweden is calling for a ban on digital money. To put forward the proposal were Erik Thedéen, Director of the Swedish Financial Supervisory Authority, e Björn Risinger, director of the Swedish Environmental Protection Agency. The reason for their request derives from the need to respect the Paris climate agreement which, without decisive interventions on the cryptographic front, would be seriously jeopardized. It remains to be seen now whether the proposal can be followed up or not.
Proof-of-Work is in the dock
In particular, the Proof-of-Work consensus algorithm ended up on the dock (PoW), which is the mechanism on which they are based Bitcoin, Ethereum, at least for the moment, and other major cryptocurrencies. A process which is based on increasingly complex calculations, such as to require very powerful machinery.
As is well known, this mechanism is considered extremely energy-intensive and has already been accused of this in a long series of scientific reports. Enough to push Tesla to block the possibility of paying for their models in Bitcoin, in order to avoid possible environmental damage.
Precisely for this reason not a few blockchain they are heading towards Proof-of-Stake (PoS), believed to be much less harmful to the ecosystem. However, it is a process which takes time. What increasingly loud alarms about a collapsing environmental situation could make it impossible to achieve.
Sweden is increasingly at the center of mining
The request for the Swedish side also derives from what is happening inside the Scandinavian country. After notice against the mining issued by China, miners have begun to look around to try to understand what the best alternatives currently viable might be. By identifying a possible option in Sweden where, in fact, the cost of electricity is very low, thanks to the increasingly conspicuous contribution of renewable sources.
To better understand what is happening, it will suffice to remember that between April and August of the current year, the country has seen an increase in the consumption of electricity used for mining until it reaches that used by 200 thousand families. For his part, Björn Risinger himself stated that the consumption necessary for the extraction of a Bitcoin is able to supply power to an electric car to drive them 1,8 million kilometers, or 44 times around the world. An intolerable level in the light of global warming.
What could happen now?
The alarm raised by Sweden reflects the common feeling of many Northern European countries. If the same were to block in this sense, a very problematic front could open up for virtual currencies. Especially in the light of a very particular historical moment, with the movement Fridays for Future attack and the public opinion of many countries from all over the globe ready to support it.
To at least give ecologists a sop, after the recent failure of COP26 on the climate, the best way for governments to forget what happened in Glasgow could just be identified in fight against cryptocurrencies, for some time now pointed out as a real enemy for an increasingly stressed environment. If it seems risky to advocate a global ban on digital assets, a very strict regulation does not seem a utopia. All that remains is to follow the situation and its possible developments.