Digital gold? UNM Economics professors help decode the high cost of Bitcoin mining

While cryptocurrency may be virtual, the environmental toll of mining it is all too real. That's the conclusion of a new book co-authored by three University of New Mexico professors, who explore the hidden cost of Bitcoin mining in "Energy Use in Bitcoin Mining: The Environmental Impact of Cryptocurrencies," published by Routledge Press.

UNM Economics Professors Benjamin A. Jones, Andrew L. Goodkind and Robert P. Berrens collaborated to quantify the monetary damage cryptocurrency mining inflicts on both the climate and public health-raising urgent questions about the sustainability of digital currencies.

"Bitcoin mining's global electricity use is larger than that of entire countries such as the Netherlands and Argentina," the authors write. "This energy use has tremendous environmental consequences."

The project began in 2018, following their reading of a Nature Sustainability article that estimated Bitcoin mining had already outpaced the annual energy consumption of entire nations. Intrigued and concerned, the authors launched a research project to monetize those damages in economic terms, which generated a series of peer-reviewed articles. They would conclude that in economic terms "Bitcoin, in some instances, was actually more damaging to the environment than it was actually worth." The project has now moved forward with publication of the new book in April 2025.

In one study, the authors found that for every $1 of Bitcoin value created in 2018, roughly $0.49 in human health and climate damages were incurred-often placing the real-world costs higher than the currency's market price. Those damages included emissions from fossil fuel power plants, air pollution, and climate change impacts. In the new book, current estimates have been updated to find "damages on average 74% of the value of the coins generated."

The book also compares Bitcoin to other major industries, concluding that its environmental footprint was "on par with crude oil" and considerably worse than commodities like gold. "Bitcoin looked more like 'digital crude' than 'digital gold,'" the authors write.

Beyond just carbon emissions, the team delves into Bitcoin's broader environmental consequences, such as e-waste, land and water use, and noise pollution. The authors also explore policy solutions to curb cryptocurrency's energy demands and move the industry toward more sustainable practices.

"This is not an argument against Bitcoin," they clarify in the book's preface, but it is an argument against the use of the highly energy-intensive proof of work (POW) process used for mining Bitcoin. Alternative cryptocurrencies use much less energy-intensive production processes. "Our hope is that readers come away with a better understanding of the scale and magnitude of Bitcoin's environmental footprint-and with the knowledge that we, as a society, can do something about it."

Jones, the book's lead author, is an associate professor at UNM whose research focuses on the economic impacts of pollution and human health. Goodkind is an associate professor who specializes in modeling air pollution and its public health effects. Berrens, a Regents' professor, is an environmental economist who brings expertise in nonmarket valuation, climate adaptation, and environmental policy.

Together, their work has appeared in major outlets including The New York Times, The Guardian, BBC World News, and The Associated Press. Check out this link to read their new book.