Impact of Bitcoin on Climate Change

Abstract

In recent years, an escalating concern among environmentalists over the energy hunger of bitcoin mining has unleashed a widespread debate within the community. An ample number of recent studies have invested in computing the electricity consumption and the carbon footprint of bitcoin and have examined the effect of bitcoin on the environment. In this study, we applied the generalized least square (GLS) estimation, Bayesian linear regression and logistic regression on a monthly panel dataset including 31 countries from 2011 to 2021 to investigate the impact of bitcoin on climate change. The results indicate a positive effect of electricity consumption, carbon footprint, price, transaction fees, volume and number of mined bitcoin on climate change. In contrast, there is a negative effect of miners’ revenue, difficulty and bitcoin median transaction confirmation time on climate change. Based on our findings, regulators should focus more on the use of clean energy sources and efficient mining hardware to alleviate the environmental trouble of bitcoin since the results indicate that the carbon footprint and the electricity consumption of bitcoin induce temperature variability above 2°C.