The Impact of Bitcoin On The Planet

The way we see and use money has changed drastically, and we’ve come a long way since the barter system. More and more of us, Gen Z and Millennials, are using less and less physical money and are more likely to use our cards or internet transactions to pay for our bills. With the advent of technology, we are more and more in tune with technology, and it has become one with us. Bitcoin or cryptocurrency are gaining in popularity these days, and people are investing in them, but apart from their names, how much do you really know about Bitcoins. Fear not because we are here to help you discover what Bitcoins are and their impact on our planet.

What is Bitcoin?


The identity of the person who created Bitcoins is still a mystery. It was created in 2009 and is a decentralized form of digital currency and follows the ideas that were set by the pseudonymous Satoshi Nakamoto and his idea of white paper. This specific cryptocurrency offers a promise of lower transaction fees compared to traditional online payment mechanisms do. In addition, it is operated by a decentralized authority which is the opposite of government-issued currencies. It is kept secure by cryptography, and this is why it is known as a cryptocurrency. Unlike dollar bills, there are no physical bitcoins, and only their balance is kept on a public ledger that everyone can have access to. Bitcoin transactions are verified by a massive amount of computing power, a process known as mining. Bitcoins are not issued by any banks or governments, and they are one of the most popular cryptocurrencies on the market. Currently, there are about 15 000 different cryptocurrencies on the market, and there are over 400 exchanges that exist worldwide.

The flaws of cryptocurrencies

Bitcoin and other cryptocurrencies alike have some major flaws, and the mining process is highly energy-intensive. Here are some of these flaws:

Energy consumption


The mining of Bitcoin uses about 122.87 terawatt-hours of electricity every year, and this is more energy than the entire countries use. The mining of cryptocurrency uses more energy than the United Arab Emirates, Netherlands, and even Argentina. According to a study conducted by Digiconomist (which is a cryptocurrency analytics site), to mine a single cryptocurrency, we need to use 2.106.37 kilowatt-hour of electricity. This number equates to the amount of power that the average America Household uses in about 72 days. The Ethereum network, according to the Digiconomist, uses or requires an estimated 99.6 Terawatts-hours of electricity to run annually, and this is more energy than the Philippines or Belgium uses. One single Enthereum transaction consumes about 220.5 kilowatt-hours of electricity, approximately about the same amount of power an average American household uses in 7.44 days. The energy demand to mine cryptocurrency is predicted to increase in the coming years as crypto increases and mining efficiency decreases.

Bitcoin mining produces about 96 million carbon dioxide emissions annually, which equates to the amount of carbon emission generated by some smaller countries. Mining for Ethereum also produces more than 47 million tons of carbon dioxide emissions every year. Studies conducted by the University of Cambridge report that 35% of most Bitcoin mining in 2021 took place in the United States. This is detrimental to the environment because the US gets most of its electricity from burning electricity. Interestingly enough, the study conducted by Cambridge University also discovered that renewable energy sources powered 39% of proof-of-work mining. It should also be noted that the mining of cryptocurrency also generates an insane amount of electronic waste because mining hardware becomes obsolete quickly. According to the Digiconomist, the Bitcoin network alone creates approximately 30 thousand tons of electronic waste annually.

Sound off in the comments section below and tell us if you want to read more about Bitcoin or cryptocurrencies and their impact on the environment.

5 Ways to Have a Positive Impact With Your Money

The pandemic has seen a surge in trading on the stock market, with more young people than ever before turning to investment to generate savings. This new generation of investors is also driving ethical and sustainable investment trends across the globe. In Australasia, sustainable investing grew by 25% between 2018 and 2020 and a recent report from Responsible Investment Association Australasia (RIAA) found 69% of millennials consider social issues when investing.
Values-based investing takes many forms — socially responsible investing (SRI), environmental, social and governance (ESG) investing, ethical investing and impact investing. In addition to these investment strategies, there are simple steps you can take to ensure your money is having a positive impact, such as switching banks or energy providers.
Below, we outline five ways to align your finances and personal values.

Reconsider Where You Bank


This might seem basic but research shows many young Australians still use the same bank as their parents. A 2019 survey by Credit Union Australia found that 50% of Australians between 18 and 24 opt for the same bank as their mum and dad. This helps explain the continued dominance of the ‘big four’ banks — NAB, CommBank, Westpac and ANZ — which hold more than 80% of mortgage borrowers in Australia.
What is your bank doing with your money? It might seem simple but when considering the institution’s ethics you give your cash to, it should be the first question you ask. Lack of transparency can make it challenging to find an answer, but online resources show what industries banks invest in. A market analysis released in 2019 revealed that despite making public climate commitments, the big four Australian banks loaned $7 billion to 33 new or expansionary fossil fuel projects between 2016 and 2019.
You have a few options as a consumer in terms of how to approach this. Firstly, you could send a strong message to the big banks by taking your money elsewhere. Several Australian banks do not invest in destructive industries like fossil fuels and gambling. Some only invest in projects that have a positive environmental and social impact, such as Bank Australia.

Switch to an Ethical Super Fund

Another way to have a positive impact on your money is switching to an ethical super fund. Again, start by doing some research into your current fund’s investments and seeking out ethical alternatives. The Responsible Investment Association Australasia website has fact sheets and guides to help you learn the basics of responsible investing. They have also published a research paper on the Australian super funds engaging in this practice.
Once you’ve compiled a shortlist of super funds you’re interested in, head to their websites to read more about the specific projects they support. Look for a fund’s investment policy, charter or criteria to find detailed information about their screening process and the impacts of their investments.

Explore Impact Investing


While there are many types of ethical and sustainable investing, impact investment is perhaps most closely aligned with the principles of a circular economy. Impact investing goes beyond screening out negative investments to actively invest in projects with social and environmental benefits. This type of investment is part of a new regenerative finance paradigm that conceptualizes money as a force for positive systems change.
Impact investment supports projects that generate measurable social, environmental or cultural outcomes alongside financial returns, from renewable energy to social housing. Impact investing finances both biological and social regeneration projects, with the underlying aim of improving equity and well-being.

Use Sustainable Investment Platforms

Once you know enough about investing to give it a go, the next step is to determine what platforms to use. This will also require some research into the robo-advisor platforms and micro-investment apps offering ethical investment opportunities.
Robo-advisors are digital platforms that provide algorithm-generated investment services. A number of these platforms are dedicated to specific social or environmental causes, such as Ellevest which aims to improve gender equality or EarthFolio, which invests in funds with solid ESG (environment, social and governance) practices.
Many micro-investment apps also come with the option of building ethical or sustainable investment portfolios. These apps allow you to invest small amounts of money over time, with minimum investments starting at $1.

Use Your Purchasing Power for Good

Last but definitely not least is using your purchasing power for good. Every time you shop for food, clothes or other goods is an opportunity to support local, ethical and sustainable businesses. This might mean buying your fruit and veg from a local market — giving money directly to producers and avoiding all the carbon miles and packaging associated with supermarket veg — or buying from a small company that uses recycled materials to make its products. As consumers, we can vote with our dollars for the businesses working towards the kind of world we want to live in.


Let us know in the comments below if you plan on being socially responsible with your money.