Advocacy groups hope the United States will impose restrictions on cryptocurrency mining as governments around the world crack down on the booming industry stressing electrical grids.
Last January, the U.S. Energy Information Administration announced that it was launching a provisional survey to track electricity consumption by cryptocurrency mining companies. The Office of Management and Budget granted the emergency authorization.
The move came after a coalition of advocacy groups raised the alarm to the EIA about the sector's energy usage and environmental impact. As detailed by Earthjustice — one of the organizations involved in the petition — China banned cryptocurrency mining in 2021, but the U.S. continued the practice, with nearly 40% of all mining occurring stateside in 2023.
"We are encouraged by the EIA's actions to collect information on this hugely energy-intensive industry, which has grown so substantially in the United States in just the past couple of years and for which there is so little publicly-available information," Mandy DeRoche, deputy managing attorney of Earthjustice's Clean Energy Program, said of the EIA's decision.
Now, around a year after the EIA's announcement, more and more countries have moved to limit or ban cryptocurrency mining as they become aware of its potential pitfalls.
Mining — that is, the transaction validation process involving complex mathematical puzzles — requires an eye-popping amount of energy and power. A joint study by Earthjustice and the Sierra Club found that "proof-of-work" mining produced 27.4 million tons of carbon pollution between mid-2021 and 2022, or as much as 6 million gas-powered vehicles.
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Cryptocurrency mining can also be loud — so loud that a Texas community near a bitcoin mining facility filed a lawsuit against the operator alleging that it ruined their quality of life, citing hearing loss, severe vertigo, sleep disruptions, and more. Plus, the sector's strain on the power grid threatens to raise electricity rates.
While more advanced cooling systems could help address mining noise, cryptocurrency networks such as ethereum are tinkering with their consensus mechanisms to solve the massive energy drain. The company's "proof-of-stake" system decreased power use by a whopping 99.95%.
Ultimately, though, the future of cryptocurrency in the U.S. remains unclear.
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Definitely 👍 President-elect Donald Trump has been outspoken in his support of the sector. And in July, Utility Dive reported that the EIA had halted its emergency survey after the Texas Blockchain Council sued it for "advancing the survey without a full review," citing concerns about protecting proprietary data. However, the agency had a second provisional survey in the works.
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"Utilities and anyone who depends on reliable, affordable electricity should support the EIA's effort to bring transparency to this energy-intensive industry," Caroline Weinberg, senior research and policy analyst of Earthjustice's Clean Energy Program, said in a statement for the organization over the summer after the EIA announced its new survey.
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