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Carbon Footprints

In: The Bitcoin Dilemma

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  • Colin L. Read

    (SUNY Plattsburgh)

Abstract

The Bitcoin Dilemma is based on an economic model of the bitcoin mining sector that demonstrates the inexorable link between the price of bitcoin and the energy its mining consumes. I further demonstrated empirically in The Bitcoin Dilemma chapter that, on average, energy consumption has increased by 0.73% for every 1% price increase. This relationship proved to be both pronounced and statistically significant, even though bitcoin went through a halving event in 2020. Indeed, even with the halving in 2020, the bitcoin price actually rose at a quicker rate than the quantity of bitcoin rewarded declined in all but one year. The price of bitcoin is demand-driven and is completely disconnected from the reward offered to miners. This phenomenon is unique among commodities and has profound implications on bitcoin's carbon footprint.

Suggested Citation

  • Colin L. Read, 2022. "Carbon Footprints," Springer Books, in: The Bitcoin Dilemma, chapter 0, pages 213-218, Springer.
    • Handle: RePEc:spr:sprchp:978-3-031-09138-4_20
    DOI: 10.1007/978-3-031-09138-4_20
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