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The control of greenhouse gas emissions generated by the use of cryptocurrencies
 
Код статьиS0029193-2-1
DOI10.18254/S278229070029193-8
Тип публикации Статья
Статус публикации Опубликовано
Авторы
Fagundes Isolani Lucas  
Должность: Law Doctorate STudent
Аффилиация: University of Itaúna
Адрес: Itaúna, Rodovia MG 431 – Km 45 (Trevo Itaúna/Pará de Minas) – Caixa Postal 100
Ribeiro Brasil Deilton
Должность: Law Scholar
Аффилиация: University of Itaúna
Адрес: Itaúna, Rodovia MG 431 – Km 45 (Trevo Itaúna/Pará de Minas) – Caixa Postal 100
Название журналаLaw & Digital Technologies
ВыпускТом 3 № 2
Страницы18-25
Аннотация

This research outlines how the use of cryptocurrencies like blockchain can be detrimental to the environment, primarily due to the emission of greenhouse gases. The research is justified in light of the current relevance of the topic, as carbon emission control is a global and governmental concern for the preservation of the environment for future generations. The investigation began by addressing the issue of greenhouse gas emissions due to the use of cryptocurrencies such as bitcoin through blockchain. Subsequently, the importance of controlling greenhouse gas emissions and the associated indices due to the use of cryptocurrencies were discussed. Following that, the policies for controlling greenhouse gas emissions in Brazil were examined. Through theoretical-literature review, documentary research, and deductive methods, it was determined that the use of clean energy sources is necessary for the maintenance of this technology to reduce the environmental impacts it currently poses. The study highlights the need for using clean energy or alternative methods in the utilization of cryptocurrencies to avoid the high release of greenhouse gases as observed in current practices.

Ключевые словаEmission of Gases; Greenhouse effect; Cryptocurrencies; Blockchain; New technologies
Получено09.11.2023
Дата публикации30.12.2023
Кол-во символов28576
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Оглавление

INTRODUCTION
ENERGY CONSUMPTION THROUGH BITCOIN
CARBON EMISSION CONTROL
CONCLUSION
1

INTRODUCTION

Bitcoin is a decentralized cryptocurrency created in 2009 by an individual or group of individuals under the pseudonym Satoshi Nakamoto (2008). It operates as a peer-to-peer electronic payment system that enables money transfers without the need for an intermediary, such as a bank. Nakamoto (2008) compared the creation of new coins in this way with gold mining (hence the term Bitcoin mining), and noted that “in our case, it’s CPU time and electricity that is expended”.
2 There is a growing interest among consumers in financial transactions involving cryptocurrencies, as evidenced by the high search volume for terms related to Bitcoin, blockchain, and cryptocurrencies on Google Trends. Searches for “Bitcoin” appear to be more intense than those for “cryptocurrency” and “blockchain”, especially in Western economies (Polemis and Tsionas 2023, 3). Bitcoin has increasingly become a part of financial transactions, with a market capitalization in the billions of dollars and a growing number of cryptocurrencies in circulation. However, the blockchain validation process consumes a significant amount of electricity, resulting in substantial carbon dioxide (CO2) emissions, raising concerns about its environmental impact.
3 The security of the Bitcoin network is ensured through encryption, a coding technique that protects transactions and user identities. Each transaction is recorded in a public ledger known as the blockchain, which is an immutable digital ledger allowing verification of all transactions.
4 Blockchain is a distributed ledger technology that enables the creation of a secure, decentralized database shared among multiple parties without the need for a centralized intermediary for transaction validation. According to Tapscott and Tapscott (2016), blockchain is a digital ledger composed of interconnected transaction blocks, forming an immutable chain of records.
5 The functioning of blockchain is based on cryptography, ensuring the security and privacy of transactions. Each transaction is validated by a network of nodes using consensus algorithms to verify information authenticity. According to Antonopoulos (2014), the decentralization of blockchain ensures system integrity, as there is no single point of failure, making it resistant to malicious attacks.
6 Blockchain also emerged in 2009 with the creation of Bitcoin, the first decentralized cryptocurrency using blockchain as a transaction record. A Blockchain is a list of encrypted digital record or transaction, called a block. Each block is then “chained” to the next block, in a linear, chronological order, using a cryptographic signature. The blocks contain a copy of the last transactions since the last block was added (Bogart and Rice 2015). Thus, the shared block, or ledger, is linked to all participants who use their computers in a network to validate or confirm transactions, removing the need for a third-party (Christidis and Devetsikiotis, 2016; Porru et al. 2017). The price of Bitcoin is determined by market supply and demand and can be extremely volatile. It is also affected by macroeconomic, regulatory, and security events.
7 While Bitcoin has been praised for its ability to provide a fairer and more inclusive financial system, it also faces criticism for its negative environmental impacts. Bitcoin mining consumes a significant amount of energy, mainly due to the use of specialized hardware to solve complex mathematical problems necessary for transaction validation and adding new blocks to the blockchain. This mining process is known to be highly energy-intensive and can have significant environmental impacts.
8 Concerns about greenhouse gases are central to the debate on environmental preservation and the mitigation of global climate change. Greenhouse gases, such as carbon dioxide, methane, and nitrous oxide, trap part of the solar radiation in the Earth's atmosphere, contributing to the increase in the planet's average temperature. This temperature rise can trigger a series of negative impacts, such as polar ice cap melting, sea level rise, extreme weather events, and a reduction in the availability of drinking water. In this context, it becomes essential to seek alternatives to reduce greenhouse gas emissions and mitigate the impacts of climate change, aiming to ensure a sustainable future for the next generations.
9 The research issue is the environmental repercussion of blockchain usage. The problem is: is such currency sustainable? The central objective is to demonstrate the environmental repercussions of blockchain usage. Specific objectives include exploring the environmental impacts of using bitcoin and how it affects greenhouse gas emissions. The research was conducted through a systematic and deductive review method. Regarding the technical procedures for collecting the data that guided the research, a bibliographic survey was used, with focus on doctrinaire, normative, and jurisprudential readings related to the issue, since they provided the theoretical basis for the preparation of the paper and discovery of other concepts that allowed the issuance of a conclusive opinion after the end of the research.

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