A recent study has indicated that, on average, the amount of water used for a single Bitcoin transaction could fill a typical backyard swimming pool.
Alex de Vries of Vrije Universiteit Amsterdam estimates that six million times more energy is used in a typical credit card swipe compared to the amount used.
The utilization of water to activate and chill the numerous computers around the globe which are needed for Bitcoin to function is responsible for the figure.
In numerous regions, there is difficulty in obtaining an adequate supply of fresh water.
It is estimated that up to 3 billion people around the globe are already enduring water scarcity, with this figure expected to escalate in the decades ahead, according to the research.
Mr de Vries informed the BBC that Central Asia, as well as the US, specifically California, is facing this issue and it will become more critical as climate change worsens.
Altogether, bitcoin appears to have consumed around 1,600 billion liters - or, as it's called, gigaliters (GL) - of water in 2021, according to a study released in Cell Reports Sustainability.
It suggests that the number for 2023 could be over 2,200 GL.
The massive consumption of water seen with Bitcoin is due to the need for a vast amount of computing power, as this also requires a significant amount of electricity.
The energy consumed by Bitcoin is so great that it is only slightly smaller than the whole of Poland's electricity consumption, according to Cambridge University's data.
Water is utilized to reduce the temperature of the gas and coal-fueled plants that contribute greatly to our energy production. Moreover, copious amounts of water evaporate from the reservoirs that provide energy to the hydroelectric facilities.
To keep the numerous computers around the world which are responsible for Bitcoin transactions functioning properly, some water is utilized to maintain a cool temperature.
Mr de Vries contends that Bitcoin does not require such massive use of water - especially as regards the energy-intensive process that is referred to as "Bitcoin mining."
Miners audit transactions for a chance to obtain the digital currency.
They vie with one another to get the audit done quickly, thus the same operation is being conducted in succession by a multitude of powerful and ambitious computers.
Mr. de Vries informed the BBC that millions of devices around the globe were in continual rivalry with one another in what he called a vast 'guess the number' match.
"Altogether, these devices are producing 500,000,000,000,000,000,000 (500 quintillion) guesses every second without stopping."
This approach is acknowledged as "proof of work". However, making a modification to Bitcoin's operations could significantly decrease electricity usage and, as a result, water consumption.
In September 2022, Ethereum, a major cryptocurrency, made the switch to a system called "proof of stake" which dramatically decreased its power consumption by over 99%.
It might not be simple, as per the observation of Professor James Davenport of the University of Bath.
He told the BBC that Ethereum's management is notably more centralized than Bitcoin's, making it possible.
However, it is worrying that some are concerned by the results of this study.
Dr. Larisa Yarovaya, an associate professor of finance at the University of Southampton, expressed that the use of freshwater for Bitcoin mining, particularly in arid locations, "should be seen as a warning signal for regulators and the public".
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