Analysts at Bank of America have converted Bitcoin’s carbon footprint to cars. But they also have other arguments against cryptocurrency.
Unclean investment: The US electric car manufacturer Tesla recently purchased a large amount of Bitcoin. The action is controversial from a climate protection perspective because of the high computing power required for cryptocurrency. Bank of America has related Bitcoin investments to internal combustion vehicles.
Investors concerned about environmental aspects of their investments should “pay attention to Bitcoin’s enormous environmental costs,” according to a Bank of America report titled “Bitcoin’s dirty little secrets.” As the authors calculated, buying $1 billion worth of Bitcoin releases as much carbon dioxide as 1.2 million internal combustion engine vehicles in a year.
Transferred to Tesla, this means: The purchase of Bitcoin for 1.5 billion dollars corresponds to the annual carbon footprint of 1.8 million combustion engines, against which the head of the electric car manufacturer otherwise always rages. Musk had already been criticized because of the poor environmental balance.
However, Tesla has bought Bitcoin and wants to accept the cryptocurrency as a means of payment in the future. According to the Statista database, an average of 741 kilowatt-hours of electrical energy is required for a Bitcoin transaction. According to the Bank of America study, one transaction releases around 270 tons of carbon dioxide, as much as 60 cars.
However, the study does not only address the environmental balance of cryptocurrency. It also evaluated whether it is worth investing in it. Here, the analysts advise against it: Bitcoin is very volatile and therefore “impractical as an asset investment and payment mechanism,” online news site Yahoo Finance UK quotes from the report.
There is “no good reason to own BTC unless you see prices rising,” the authors sum up. That, at least, has been the case recently: Tesla’s investment in Bitcoin has driven the value of the cryptocurrency up neatly, which makes it attractive to mine even more Bitcoin, further worsen the carbon footprint.