Ethereum Blockchain’s Historical Emissions Equivalent to Honduras’ Annual Emissions, Study Shows
A University of Cambridge study reveals the environmental impact of the Ethereum blockchain before a major software upgrade reduced its energy usage.
Blockchain technology has long been criticized for its high energy consumption and environmental impact. In a groundbreaking study by the University of Cambridge, the historical greenhouse gas emissions of the Ethereum blockchain were found to be equivalent to the annual emissions of Honduras. However, a major software upgrade known as the “Merge” has significantly reduced Ethereum’s energy usage. This study sheds light on the environmental impact of cryptocurrencies and highlights the potential for blockchain technology to become more sustainable.
The Environmental Impact of Blockchains
Blockchains, the digital ledgers that underpin cryptocurrencies, have drawn criticism from environmentalists and investors due to their high energy consumption. The process of producing coins and processing transactions on blockchains consumes significant amounts of energy. However, calculating the exact environmental impact of the crypto sector is challenging due to its lack of centralized data and relative opacity.
The Ethereum Blockchain’s Energy Usage Before the Merge
Before the major software upgrade known as the “Merge” in September 2022, the Ethereum blockchain, which hosts the second-largest cryptocurrency, ether, had considerable greenhouse gas emissions. According to the University of Cambridge study, Ethereum’s emissions totaled 27.5 million tonnes carbon dioxide equivalent (MtCO2e) from its launch in 2015 until the Merge. This is roughly equivalent to the annual emissions of Honduras in 2020, as reported by Climate Watch.
The Impact of the Merge on Ethereum’s Energy Usage
The Merge software upgrade significantly reduced Ethereum’s energy consumption. Developers claim that the post-Merge system uses over 99% less energy. The study found that Ethereum’s current yearly emissions are approximately 2.8 kilotonnes carbon dioxide equivalent, which is equivalent to the emissions from five round-trip flights from London to New York. This showcases the potential for blockchain technology to become more environmentally friendly.
Ethereum’s Role in Shaping the Perception of Blockchain Technology
Anna Lerner, the executive director at the Ethereum Climate Platform, emphasizes that Ethereum’s ability to reduce its environmental impact challenges the perception that blockchain technology is inherently polluting. Lerner believes that Ethereum’s example can inspire other blockchain projects to prioritize sustainability and explore ways to minimize their carbon footprint.
A Comparison to Bitcoin’s Emissions
While Ethereum has made significant strides in reducing its environmental impact, the study also highlights the emissions of Bitcoin, the largest blockchain and cryptocurrency. Bitcoin creates approximately 73.9 MtCO2e annually, based on its daily emissions in November 2022. This is roughly equivalent to the annual emissions of Cambodia in 2020, according to Climate Watch. The study underscores the need for further efforts to address the environmental impact of cryptocurrencies.
Practical Usage and Future Implications
Despite the environmental concerns surrounding cryptocurrencies, they remain primarily an investment tool with limited practical usage in business or commerce. As the world grapples with the climate crisis, the study’s findings provide an opportunity for the crypto industry to reflect on its environmental responsibilities. It also raises questions about the potential for broader adoption of blockchain technology in various sectors while minimizing its carbon footprint.
Conclusion:
The University of Cambridge study on Ethereum’s historical emissions sheds light on the environmental impact of blockchain technology. While the Ethereum blockchain’s emissions were once equivalent to the annual emissions of Honduras, a major software upgrade known as the Merge has drastically reduced its energy usage. This demonstrates the potential for blockchain projects to prioritize sustainability and minimize their carbon footprint. However, the study also highlights the significant emissions of Bitcoin, underscoring the need for continued efforts to address the environmental impact of cryptocurrencies. As the world seeks to maximize energy efficiency, the findings of this study provide valuable insights for both the crypto industry and the broader adoption of blockchain technology.