Carbon Footprint of a single Litecoin Transaction: a back of the envelope style analysis

A back of the envelope rough estimate of Litecoin comes to an estimate of about 30kg of CO2e per Litecoin transaction. Assessing the carbon footprint of cryptocurrency transactions involves many uncertainties and assumptions, so this could be far of.

Calculation

While concerns about energy usage and climate impact grow, many are curious about the carbon footprint of blockchain transactions. While a cryptocurrency’s energy consumption doesn’t scale directly with the number of transactions, we can still roughly estimate how much CO₂ is “embedded” in each Litecoin transaction using several complementary approaches.

Method 1: From Network Power to Transaction Emissions

One common method is to start from an estimate of the network’s power consumption and then “allocate” that energy across the transactions processed.

1. Estimating Power Consumption:

   • A typical modern Litecoin mining rig operating with ScryptPoW might average an efficiency of around 0.25 W per MH/s.
   • Suppose Litecoin’s network hash rate is roughly 320 TH/s. Converting, we have:
     320 TH/s = 320 × 10⁶ MH/s
     Multiplying by the efficiency:
     320 × 10⁶ MH/s × 0.25 W/MH/s ≈ 80 MW of power.

2. Energy per Block:

   • Litecoin targets a block time of about 2.5 minutes (150 seconds).
   • Energy per block = Power × Time = 80 MW × 150 s = 12 GJ (12 × 10⁹ joules).

3. Dividing by Transactions:

   • If a typical block contains around 35 transactions, then each transaction “carries” roughly:
     12 GJ / 35 ≈ 343 MJ.
   • Converting to kWh (1 kWh ≈ 3.6 MJ):
     343 MJ ÷ 3.6 ≈ 95 kWh per transaction.

4. Converting Energy to CO₂:

   • Assuming an average carbon intensity of 0.5 kg CO₂/kWh, we find:
     95 kWh × 0.5 kg CO₂/kWh ≈ 47.5 kg CO₂ per transaction.

This approach suggests roughly 50 kg CO₂ per Litecoin transaction—but note that the mining hardware, energy mix, and transaction count per block all introduce uncertainty.

Method 2: Scaling Down Bitcoin’s Energy Footprint

Another approach leverages known figures for Bitcoin, adjusting for Litecoin’s lower energy consumption:

1. Energy Comparison:

   • Bitcoin is estimated to consume about 110 TWh/year (at the moment of writing even higher).
   • Since Litecoin uses the ScryptPoW algorithm, it is generally more energy-efficient. Many estimates place Litecoin’s total energy consumption at around 1–2% of Bitcoin’s, or roughly 2 TWh/year.

2. Energy per Transaction:

   • If Litecoin processes roughly 30 million transactions per year, then:
     2 TWh/year = 2,000,000,000 kWh/year
     2,000,000,000 kWh / 30,000,000 transactions ≈ 67 kWh per transaction.

3. CO₂ Emissions:

   • Using a global average carbon intensity of ~475 g CO₂/kWh (0.475 kg CO₂/kWh):
     67 kWh × 0.475 kg CO₂/kWh ≈ 32 kg CO₂ per transaction.

This method, based on scaling Bitcoin’s consumption, suggests around 30–32 kg CO₂ per Litecoin transaction.

Method 3: Using Reported Network Emissions and Transaction Volumes

A third method comes from directly using reported figures for annual emissions and daily transaction counts:

1. Reported Figures:

   • Sources indicate Litecoin’s mining might be responsible for about 1.3 million tonnes (Mt) of CO₂ per year (source).
   • Recent data shows around 186,000 transactions per day.

2. Annual Transactions:

   • Daily transactions multiplied over a year (source):
     186,000 × 365 ≈ 67.9 million transactions per year.

3. CO₂ per Transaction:

   • Dividing the annual CO₂ by the number of transactions:
     1,300,000 tonnes CO₂ / 67,900,000 transactions ≈ 0.019 tonnes, or about 19 kg CO₂ per transaction.

This method yields an estimate on the lower end—roughly 20 kg CO₂ per transaction.

Putting It All Together

Each method relies on different assumptions:

• Method 1 (power consumption per block) estimates about 50 kg CO₂ per transaction.
• Method 2 (scaling Bitcoin’s energy use) yields roughly 32 kg CO₂ per transaction.
• Method 3 (using reported annual emissions and transaction counts) suggests close to 20 kg CO₂ per transaction.

Given the uncertainties—such as variations in mining hardware efficiency, the actual mix of energy sources (fossil versus renewable), and fluctuations in transaction volume—a back‐of‐the-envelope range for a Litecoin transaction is approximately 20–40 kg CO₂. Some estimates might lean higher (around 50 kg) when considering peak or worst-case scenarios.

Final Thoughts

While none of these calculations are definitive, they serve as useful approximations. The key takeaway is that, even if Litecoin’s energy consumption per transaction appears modest compared to Bitcoin’s, each transaction likely “embeds” on the order of tens of kilograms of CO₂. But still way higher than proof-of-stake networks like Ethereum. Also keep this in mind would you ever consider to pay with crypto.

As the energy landscape evolves and more miners adopt renewable sources, these numbers could shift—highlighting the importance of both energy efficiency and clean energy adoption in the cryptocurrency space.

Last Updated on 18 February 2025