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Bitcoin miners pledge to address climate concerns after Elon Musk meeting

·3-min read
Elon Musk
Elon Musk

Major Bitcoin miners have committed to cutting their carbon footprints after a weekend summit with Elon Musk over the cryptocurrency’s emissions.

Mr Musk, who has fanned a row over Bitcoin’s environmental impact that has contributed to its recent price fall, said miners in North America had committed to disclosing their use of renewables.

Argo Blockchain, a London-listed Bitcoin miner whose chief executive Peter Wall was in the Zoom meeting, said it would soon publish an audit of its 2020 energy use. Mr Wall said many miners shared Mr Musk’s concerns about Bitcoin’s emissions.

Bitcoin miners use high-powered computers to process transactions on the Bitcoin network and create new coins. The process has been criticised for its energy demands, with the cryptocurrency’s annual energy consumption estimated to be higher than entire countries such as The Netherlands and Chile.

Mr Musk recently said that Bitcoin’s emissions meant Tesla would no longer accept it as a payment method, a U-turn that came just months after the electric carmaker announced it would allow cars to be bought with the cryptocurrency.

The announcement, combined with the threat of crackdowns in China and elsewhere, have sent Bitcoin’s price plummeting in recent days from an April high of $63,000 to around half that on Sunday. Its price recovered on Monday to over $38,000.

On Monday, Mr Musk tweeted: “Spoke with North American Bitcoin miners. They committed to publish current & planned renewable usage & to ask miners [worldwide] to do so. Potentially promising.”

Michael Saylor, whose company MicroStrategy is a major Bitcoin investor, said that eight companies had formed a “Bitcoin Mining Council” that would standardise reporting on energy usage and push for more use of renewables.

Mr Wall said: “The fact that this is a group of miners coming together to agree that ESG concerns are important, and need to be dealt with and be at the forefront of our mining strategies, is really significant.”. He said that Mr Musk had asked questions about what power sources their mining operations relied on and if they were moving further towards renewables.

“Elon asked good questions. His engagement level was excellent. He’s obviously a smart guy. He’s an influential individual and has the ability to have a big impact, so the more people from all industries that can engage with him and share what they know, the better it will be,” Mr Wall said.

When asked if the miners had won over Mr Musk, he said: “I think that we’re moving in the right direction. The more that ESG concerns can be addressed… the more people like Tesla will feel comfortable buying and holding Bitcoin.” However, he said that miners in countries where power is cheap and plentiful would also need to change.

China accounts for around 65pc of Bitcoin mining, compared to only 7.2pc in the US, according to researchers at the University of Cambridge. Some cryptocurrency miners in China have said they are halting operations in the country due to a recently announced crackdown from Beijing.