By Temple Melville

A GROWING number of people in the UK now hold cryptocurrency, with around 2.3 million adults now holding an average of £300 in coins such as Bitcoin and Ethereum. While the networks underpinning these currencies have previously come under fire for their impact on the environment, there could be an as-yet untapped opportunity to turn that on its head and harness the rising popularity of crypto for environmental goals.

The opportunity lies in the fact that Bitcoin mining – the process of adding records to the blockchain, essential for the system’s validity and security – can take place from anywhere in the world, particularly in locations producing excess, often wasted, energy. In Scotland, that includes our oil and gas sector, in which the burning of surplus gas is routine practice and estimated to account for around one-fifth of UK offshore oil and gas production-related carbon dioxide emissions.

To help curb some of the emissions, you could quite feasibly have infrastructure set up as part of an offshore platform or processing plant to capture the excess gas, use it to generate electricity and put it directly towards crypto mining. With the right equipment and an internet connection, amendments to the blockchain could, therefore, be powered by what would have otherwise been wasted energy.

Undoubtedly one of the biggest needs for power and consuming more than half of Scotland’s energy, heating our homes and buildings could also be supported by crypto mining. If captured and diverted in the right way, heat produced as a by-product of the computing process could be used to power systems that would usually be connected to the grid. This is already happening in the United States, for instance, with Bitcoin miners using the heat for greenhouses.

It could help to manage the demands on our power grid too. Unlike other industries, crypto mining can be shut down and restarted almost at the flick of a switch, utilising surplus electricity when available and shutting down when there is a shortage. We could learn from Sweden’s approach, where miners are drawn to the country for the availability of cheap, renewable energy, but help with management of the grid.

In the meantime, there are also other ways crypto is already seeking to significantly reduce its overall energy consumption. The Ethereum network for example – the blockchain system used by Scotcoin – has already committed to switching from proof-of-work to proof-of-stake later this year, which will cut its energy consumption by 99.95 per cent.

Like our transition to net zero, the widespread adoption of crypto will take some time. But, as the market grows, we have a range of opportunities to use it as a force for good – especially in an environmental sense. With more people likely to hold cryptocurrency and get involved in mining in the years ahead, we should have systems in place to collaborate with other sectors and use energy that would otherwise be wasted to power these transactions and, in turn, reduce Scotland’s excess emissions.

Temple Melville is CEO of the Scotcoin Project CIC