The White House Office of Science and Technology Policy published a report Thursday revealing that digital assets could have significant environmental impacts, and proposed recommendations on how to limit their contribution to climate change.
"Electricity usage from digital assets is contributing to GHG emissions, additional pollution, noise, and other local impacts, depending on markets, policies, and local electricity sources," the report stated. "Depending on the energy intensity of the technology used, crypto-assets could hinder broader efforts to achieve net-zero carbon pollution consistent with U.S. climate commitments and goals."
According to a White House fact sheet, approximately one-third of global crypto asset operations take place in the U.S., which consumes 0.9% to 1.7% of total domestic electricity usage: roughly equivalent to the electricity usage of all home computers and residential lighting in the country. Crypto is especially energy-intensive as it requires computers to complete complex calculations on the blockchain in order to verify transactions, also known as crypto mining.
The report suggests that the Environmental Protection Agency, Department of Energy and other federal agencies work with local entities and the crypto industry to develop environmental performance standards for crypto technologies.
"These should include standards for very low energy intensities, low water usage, low noise generation, clean energy usage by operators, and standards that strengthen over time for additional carbon-free generation to match or exceed the additional electricity load of these facilities," the report said.
If this doesn't help reduce environmental impacts, the report recommends the administration consider executive action and Congress consider legislation to restrict the use of high-energy intensity consensus mechanisms for crypto mining.
The Biden administration has taken steps toward combating the climate crisis in several ways, most recently through the passage of the Inflation Reduction Act, which invests $369 billion toward reducing climate change.
Among other recommendations, the report encourages increased transparency and data collection from the industry on crypto mining locations, annual electricity usage and greenhouse gas emissions.
