Bitcoin Mining Council Rebuts US Lawmakers’ Concerns About Proof-of-Work

More than 50 representatives of the bitcoin industry signed a letter to the Environmental Protection Agency refuting the concerns raised by a group of US congressmen about the environmental risks of mining.

Certain members of Congress sent a letter to the EPA premised on several misperceptions about #Bitcoin mining. We have authored a response to clear up the confusion, correct inaccuracies, and educate the public.https://t.co/Ks6fh9Cg0Z

— Michael Saylor⚡️ (@saylor) May 2, 2022

In April, a group of policymakers appealed to the Agency to examine the mining industry for environmental risks and compliance with relevant laws.

The authors’ particular concern was the Proof-of-Work consensus algorithm. According to them, a single transaction on the Bitcoin network consumes as much electricity as the average American household uses in a month.

Among other concerns, they cited greenhouse gas emissions, the growth of electronic waste due to aging equipment, and the reopening of mothballed coal- and gas-fired power plants.

Created in 2021, the Bitcoin Mining Council sent a response to the Agency addressing the congressmen’s concerns point by point.

Michael Saylor, the CEO of MicroStrategy and a co‑founder of the organisation, commented on the letter:

“Some members of Congress sent a letter to the Environmental Protection Agency, based on several misconceptions about Bitcoin mining. We wrote a response to clear up the confusion, correct inaccuracies, and educate the public.”

The authors noted that, in most cases, policymakers directed their criticisms at miners, which should be addressed to power-generation facilities. The data centres themselves are no different from others operated by Google, Apple or Microsoft, and are energy consumers that do not emit carbon emissions.

How environmentally friendly electricity generation will be depends on policymakers’ decisions and the actions of the relevant agencies, but not on miners, the letter says. Moreover, Bitcoin miners are striving to use green energy.

The industry’s representatives called the congressmen’s claimed energy use per Bitcoin transaction a misconception. It refers to mining a block, which is 99% tied to the emission of new coins.

Regarding the large amount of electronic waste from the industry, the authors noted that the congressmen used data from a clearly biased source. They noted that the disposal of outdated mining equipment carries lower environmental risks than other devices, such as smartphones. ASIC miners are more readily recycled.

The study cited by the politicians also lists unrealistically short equipment lifespans — 1.3 years. Industry representatives noted that miners continue to use even Antminer S7s and S9s (launched in 2015 and 2017, respectively). The latest models accounted for around 40% of Bitcoin’s hashrate in 2021.

Standard depreciation periods for equipment in the industry run 3–5 years, the authors of the response noted.

“Clearly, there is a need for education so that public officials understand that the digital asset mining sector does not pose the environmental problems highlighted in the letter. It is crucial for US officials to recognise that Bitcoin and the Proof-of-Work innovation are among the most significant financial, economic, and accounting innovations in human history. The signatories believe that by embracing the Bitcoin network and mining, the United States would be more innovative and economically resilient,” the industry representatives concluded.

As noted by UN experts, cryptocurrencies have been identified as one of the risk factors in climate change.