The PoW mining sector is of interest to the Biden administration. The White House is getting ready to publish a report on blockchain mining, according to Costa Samaras, the Office of Science and Technology Policy’s (OSTP) principal assistant director for energy. Samaras noted:
“It’s important if this is going to be part of our financial system in any meaningful way, that it’s developed responsibly and minimizes total emissions. When we think about digital assets, it has to be a climate and energy conversation.”
Biden Admin To Release Mining Report
In August, the report is anticipated to be released. According to reports, it would examine mining-related concerns like the noise pollution mining rigs produce, the energy effectiveness of various consensus procedures, and more.
Bryan Daugherty the Public Policy Director for BSV Blockchain noted:
“The growing global focus on Environmental, Social, and (Corporate) Governance, Climate goals and accords, as well as the rising price of energy, have incentivized policymakers to really begin understanding the economic and energy impact of blockchain technology”
“Reports such as these greatly affect the industry across the board, from innovation to understanding. This is an opportunity to ensure continued leadership from the United States in terms of national security, innovation, and global equity if the committee is educated on the important differences in security between consensus models and the sustainable and scalable capabilities of a correctly implemented Proof of Work protocol,” He added
The Biden administration’s report will have a big impact on the blockchain and digital asset markets. It will emphasize the industry’s advantages and disadvantages and make some suggestions on how the sector can develop going forward.
The energy-intensive process of mining, which involves concluding and verifying transactions for Bitcoin, Ethereum, and other decentralized digital tokens, is having an impact on the electric sector, which is already dealing with a number of challenges like extreme weather conditions, aging wires, a switch to renewable energy sources, and a push to electrify transportation.
According to Samaras, the study attempts to go deeper into arguments that have either praised or decried cryptocurrencies as local annoyances and environmental disasters.
The team intends to compare the energy efficiency of various mining methods, such as proof-of-stake, which is used by other cryptocurrencies and is more than 99 percent more energy efficient, to Bitcoin’s proof-of-work method. Other topics to be evaluated include local noise pollution and the energy efficiency of using different mining techniques.
Related reading | Iran to Shut Down Crypto Mining Farms As Energy Crisis Deepens
PoW Consumes A Lot Of Power
The mining of cryptocurrencies consumes a lot of electricity. One indicator shows that during the previous five years, the demand for electricity in the cryptocurrency business has increased 20-fold as more people have filled their digital wallets.
BTC/USD Slides below $20k. Source: TradingView
Millions of servers may be stacked in warehouses to form mines or mining farms. According to the Cambridge Bitcoin Electricity Consumption Index, they use raw computational power to solve a series of challenging arithmetic problems, consuming more electricity annually than several individual countries, including Pakistan and Finland. The index calculates that its annual global usage is roughly equivalent to the sum of all the lights and televisions in the US.
According to the report, which was released last year, mining in the area increased monthly electricity costs by around $8 for families and $12 for small enterprises. According to the report, the increased local government tax collection from the mining expansion only partially covered the increased expenditures for residents.
More Pressure On Turbulent Industry
In a few weeks, the report is anticipated to be released by the Biden adminstration. Legislators hope that by publishing it, a wider audience will support the adoption of regulations governing mining operations.
Which government entity will be in charge of carrying out the regulations authorized by Congress is still unclear. As of now, it is clear that the EPA (Environmental Protection Agency) and other energy sector regulators will not.
According to Samaras, the Biden’s White House’s suggestions will undoubtedly exert pressure on investors to avoid involvement in or connection with cryptocurrency mining, particularly if the operations do not adhere to environmental rules.
Related reading | Bitcoin Mining Facility Shut Down Following Sharp Decline In Miner Profitability
Featured image from Getty images, chart from TradingView.com