Key points to remember
- Greenpeace and other climate activists launched a campaign called “Change the code, not the climate” to criticize Bitcoin’s Proof-of-Work consensus mechanism.
- The campaign is urging Bitcoin to ditch proof-of-work for proof-of-stake to reduce its power consumption, but it is marred by a number of dubious claims.
- He enlists Elon Musk, Jack Dorsey and Goldman Sachs to help “Clean Up Bitcoin”.
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Ripple co-founder Chris Larsen contributed $5 million to the campaign.
Greenpeace says “Clean up Bitcoin”
Greenpeace believes the cryptocurrency community needs to “clean up Bitcoin”.
The environmental campaign organization has launched a new initiative called “Changing the Code, Not the Climate” alongside a host of other climate activists in a bid to convince the Bitcoin community to move the network away from its mechanism of proof-of-work consensus. By a Bloomberg report, Ripple co-founder Chris Larsen also contributed $5 million to the campaign.
The campaign website features a number of Bitcoin-related claims to suggest the network has become a major contributor to the climate crisis. It details how Bitcoin mining uses more energy than Sweden according to a Cambridge Center for Alternative Finance study, and also links to a long-debunked report that claims Bitcoin emissions could push global warming above of 2 degrees Celsius.
The website also presents several other dubious claims in an effort to present the case that Bitcoin harms the environment. He says top crypto is “resurrecting fossil fuels” with a link to a 2021 article about a mining company buying power plants. He adds that Bitcoin is “a huge source of climate pollution” and claims that its energy consumption increases along with its market price, which is not true (energy consumption simply increases as the hashrate of the bitcoin network).
Campaign Urges Bitcoin to Remove Proof of Work
The campaign argues for proof-of-stake over proof-of-work and makes specific reference to Ethereum, which is expected to adopt the more energy-efficient consensus mechanism later this year. He says Proof-of-Stake is “a better model” and notes how Bitcoin could reduce its energy consumption by 99.9% by making the same change.
He also references bitcoin miners, saying they have “incentive not to switch” because moving away from proof-of-work would render their infrastructure useless. He then targets a number of personalities he believes have influence in the Bitcoin community.
“Leaders like Tesla’s Elon Musk, Block’s Jack Dorsey, and Fidelity’s Abby Johnson have vested interests in Bitcoin — and the power to affect change,” the website reads (the campaign also created three widgets that specifically target Musk, Dorsey, and Johnson with a message to “change the code.”) It also lists Goldman Sachs, Blackrock, and PayPal as organizations that “have a responsibility to clean up Bitcoin.”
Musk has been particularly vocal about Bitcoin’s environmental impact in the past. Last year, he caused a stir when he announced that Tesla had stopped receiving bitcoin payments due to environmental concerns. Nonetheless, Tesla still holds Bitcoin on its balance sheet, and Musk said he “won’t sell” his personal allocation alongside Ethereum and Dogecoin.
Bitcoin’s power consumption has become a hot topic as the cryptocurrency has increasingly gained mainstream attention. Its critics frequently point to the environmental impact of mining to criticize crypto as an asset class (NFTs have also come under huge criticism as the technology has exploded). Bitcoin fans, on the other hand, claim that the traditional financial system is significantly more harmful to the environment. A 2021 report from Galaxy Digital revealed that the banking system and gold consume more energy than the main crypto asset.
The Galaxy Digital Mining team has written an excellent white paper examining #bitcoinenergy consumption.
Did you know that 19 times more energy is lost during transmission than bitcoin miners consume? Great research here – and we’ve opened up our methodology.https://t.co/bTR40GdiSP pic.twitter.com/wjd92RmC1l
— Galaxy Digital Research (@glxyresearch) May 14, 2021
While the Bitcoin community has made efforts to become cleaner amid debates, with El Salvador using thermal energy from volcanoes to mine Bitcoin and a growing number of companies adopting renewable energy sources, the changes have not have done little to appease Bitcoin’s loudest critics.
“Change the Code” says it will run ads in top publications over the next month.
Disclosure: At the time of writing this article, the author of this article owned ETH and several other cryptocurrencies.
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