Bitcoin boom comes with huge intensifying environmental footprint – Mongabay

Report on Bitcoin and Its Environmental and Social Impacts in Relation to Sustainable Development Goals (SDGs)

Introduction

Bitcoin, a leading cryptocurrency, is often promoted as a revolutionary digital currency existing independently of traditional financial systems. However, its environmental and social impacts raise significant concerns, particularly in the context of the United Nations Sustainable Development Goals (SDGs). This report examines bitcoin’s energy consumption, environmental footprint, social justice implications, and the challenges it poses to sustainable development.

Bitcoin’s Energy Consumption and Environmental Impact

Exponential Energy Demand

Bitcoin mining requires enormous computing power, which translates into high energy consumption. The process involves solving complex cryptographic puzzles, demanding ever-increasing computational resources. As a result, bitcoin mining monopolizes large data centers worldwide, predominantly powered by fossil fuels, contributing substantially to carbon emissions and climate change.

Environmental Footprint

• Estimated 2025 global carbon emissions from bitcoin mining are approximately 98 million metric tons of CO₂, comparable to the emissions of Qatar, the world’s most carbon-intensive country.
• Bitcoin mining consumes as much electricity as Poland and uses water resources equivalent to Switzerland’s consumption, intensifying resource depletion.
• Each bitcoin transaction releases 712 kilograms of CO₂, equivalent to 1,578,956 VISA transactions, and consumes electricity sufficient to power an average U.S. household for over 44 days.
• Mining hardware has a short lifespan of about 18 months, generating significant electronic waste, including toxic materials such as PFAS (“forever chemicals”).

Relation to SDGs

1. SDG 7 (Affordable and Clean Energy): Bitcoin mining’s reliance on fossil fuels undermines efforts to increase clean energy use.
2. SDG 12 (Responsible Consumption and Production): The high resource consumption and electronic waste generation conflict with sustainable consumption goals.
3. SDG 13 (Climate Action): The carbon emissions from bitcoin mining exacerbate climate change challenges.
4. SDG 6 (Clean Water and Sanitation): Extensive water use for cooling mining data centers stresses water resources, especially in drought-prone regions.

Bitcoin’s Social and Environmental Justice Concerns

Impact on Vulnerable Communities

• Bitcoin mining operations have been established in economically disadvantaged and Indigenous communities, such as the Navajo Nation, often exploiting cheap energy deals while local residents lack adequate electricity access.
• In Texas, bitcoin mines increase electricity costs for residents by nearly 5%, and noise pollution from mining facilities has caused health issues, including sleep disturbances and hearing loss.
• Post-Hurricane Maria Puerto Rico saw crypto investors purchasing property and promoting “crypto-colonialism,” displacing local populations and harming cultural and environmental integrity.

Relation to SDGs

1. SDG 10 (Reduced Inequalities): Bitcoin mining’s disproportionate burden on marginalized communities exacerbates social inequalities.
2. SDG 3 (Good Health and Well-being): Noise pollution and environmental degradation from mining operations negatively affect community health.
3. SDG 11 (Sustainable Cities and Communities): The displacement and gentrification linked to crypto investments threaten community sustainability.

Economic and Financial Risks Associated with Bitcoin

Speculation and Market Volatility

Bitcoin operates largely as a speculative asset with high price volatility. The majority of bitcoin is held by a small percentage of wallets, limiting its democratizing potential. Small investors face significant financial risks, including the possibility of total loss in a market crash.

Relation to SDGs

1. SDG 1 (No Poverty): Financial losses from bitcoin speculation can deepen poverty, especially in developing countries.
2. SDG 8 (Decent Work and Economic Growth): The speculative nature of bitcoin challenges sustainable and inclusive economic growth.
3. SDG 16 (Peace, Justice, and Strong Institutions): The lack of regulation exposes small holders to risks and undermines financial stability.

Challenges to Sustainable Development and Future Outlook

Technological and Regulatory Challenges

• Proposals to reduce bitcoin’s energy consumption, such as shifting from proof of work (PoW) to proof of stake (PoS), face skepticism and lack industry consensus.
• Claims of transitioning to renewable energy sources are often contradicted by continued reliance on fossil fuels, with 85% of bitcoin energy in the U.S. still fossil-fuel based.
• Bitcoin’s linear, extractive economic model conflicts with circular economy principles, generating waste and environmental harm.

Relation to SDGs

1. SDG 9 (Industry, Innovation, and Infrastructure): Innovation in bitcoin technology is necessary but currently insufficient to address sustainability challenges.
2. SDG 15 (Life on Land): Environmental degradation from mining operations threatens terrestrial ecosystems.
3. SDG 17 (Partnerships for the Goals): Collaborative efforts are required to regulate and mitigate bitcoin’s impacts globally.

Conclusion

Bitcoin’s rapid expansion presents significant challenges to achieving the Sustainable Development Goals. Its substantial environmental footprint, social justice issues, and financial risks highlight the need for comprehensive regulation, technological innovation, and responsible investment practices. Without these measures, bitcoin’s growth may undermine global efforts toward sustainable development, climate action, and equitable economic progress.

1. Sustainable Development Goals (SDGs) Addressed or Connected

1. SDG 7: Affordable and Clean Energy
   • Bitcoin mining’s enormous energy consumption and reliance on fossil fuels directly relate to energy production and consumption patterns.
2. SDG 9: Industry, Innovation, and Infrastructure
   • The article discusses bitcoin mining technology, data centers, and blockchain infrastructure.
3. SDG 11: Sustainable Cities and Communities
   • Environmental justice concerns, noise pollution, and health impacts on communities near bitcoin mining facilities.
4. SDG 12: Responsible Consumption and Production
   • Issues of e-waste from short-lived mining chips and toxic materials in semiconductor manufacturing.
5. SDG 13: Climate Action
   • Bitcoin mining’s carbon emissions and contribution to climate destabilization.
6. SDG 14: Life Below Water
   • Water usage for cooling bitcoin data centers impacts water resources.
7. SDG 15: Life on Land
   • Environmental degradation and pollution from mining operations affecting land ecosystems.
8. SDG 16: Peace, Justice, and Strong Institutions
   • Concerns about unregulated financial speculation, criminality, and lack of protections for small holders.
9. SDG 17: Partnerships for the Goals
   • The need for global cooperation and regulation to address bitcoin’s environmental and social impacts.

2. Specific Targets Under Those SDGs Identified

1. SDG 7: Affordable and Clean Energy
   • Target 7.2: Increase substantially the share of renewable energy in the global energy mix.
   • Target 7.3: Double the global rate of improvement in energy efficiency.
2. SDG 9: Industry, Innovation, and Infrastructure
   • Target 9.4: Upgrade infrastructure and retrofit industries to make them sustainable, with increased resource-use efficiency.
3. SDG 11: Sustainable Cities and Communities
   • Target 11.6: Reduce the adverse per capita environmental impact of cities, including air quality and waste management.
4. SDG 12: Responsible Consumption and Production
   • Target 12.4: Achieve environmentally sound management of chemicals and all wastes throughout their life cycle.
   • Target 12.5: Substantially reduce waste generation through prevention, reduction, recycling, and reuse.
5. SDG 13: Climate Action
   • Target 13.2: Integrate climate change measures into national policies, strategies, and planning.
6. SDG 14: Life Below Water
   • Target 14.1: Reduce marine pollution of all kinds, including nutrient pollution and waste.
7. SDG 15: Life on Land
   • Target 15.1: Ensure the conservation, restoration, and sustainable use of terrestrial and inland freshwater ecosystems.
8. SDG 16: Peace, Justice, and Strong Institutions
   • Target 16.6: Develop effective, accountable, and transparent institutions at all levels.
   • Target 16.4: Significantly reduce illicit financial and arms flows, strengthen recovery and return of stolen assets.
9. SDG 17: Partnerships for the Goals
   • Target 17.14: Enhance policy coherence for sustainable development.
   • Target 17.16: Enhance the Global Partnership for Sustainable Development.

3. Indicators Mentioned or Implied to Measure Progress

1. Energy Consumption and Carbon Emissions
   • Metric tons of CO₂ emissions from bitcoin mining (e.g., 98 million MT CO₂ in 2025).
   • Electricity consumption measured in terawatt-hours (e.g., 32.3 TWh by largest U.S. mines).
   • Percentage of energy sourced from fossil fuels versus renewables (e.g., 85% fossil fuels in U.S.).
2. Water Usage
   • Volume of water used for cooling bitcoin data centers (comparable to Switzerland’s water use).
3. E-waste Generation
   • Amount of electronic waste generated by discarded mining chips (e.g., equivalent to discarding two iPhones per transaction).
   • Total active bitcoin mining equipment and e-waste generation over time (in metric kilotons).
4. Social and Economic Indicators
   • Distribution of bitcoin ownership (e.g., top 8% owning 99% of bitcoin).
   • Electricity cost impact on local communities (e.g., 5% extra on Texas electricity bills).
   • Health impact reports from communities near mining facilities (noise pollution, health issues).
5. Financial Market Indicators
   • Bitcoin Volatility Index (BVI) measuring market price volatility.
   • Transaction fees and frequency of bitcoin use in daily transactions.

4. Table of SDGs, Targets, and Indicators

Source: news.mongabay.com