Bitcoin has broken another record, rising above $126,279 USD on the Coinbase BTC/USD pair on October 6, 2025. The price jump came as strong inflows poured into Bitcoin exchange-traded funds (ETFs) and as the U.S. government faced a partial shutdown.

The rally shows how much investor confidence has grown in digital assets. Even in uncertain economic conditions, Bitcoin continues to attract both institutional and retail investors. Analysts say that hundreds of millions of dollars entered Bitcoin ETFs in just a single day, helping push prices to new highs.

This rise also reflects a wider shift in financial markets. Investors are using Bitcoin not just as a speculative asset but also as a hedge against inflation and government instability. As one analyst put it, “Bitcoin’s resilience during macroeconomic stress strengthens its case as digital gold.”

The $126K Question: What’s Driving Bitcoin’s Meteoric Rise?

There are a few main reasons behind Bitcoin’s latest surge, and it’s hitting over $126,000.

First, institutional demand is back in full force. Spot Bitcoin ETFs are now approved and active in the U.S., making it easier for big investors to buy Bitcoin without dealing with the complexity of wallets and exchanges.

In recent trading sessions, U.S. spot Bitcoin ETFs saw total inflows of around $307 million in a single day. BlackRock’s iShares Bitcoin Trust (IBIT) alone accounted for $177 million of that amount. These are large numbers that reflect strong confidence from big players like asset managers, pension funds, and hedge funds.

Second, the U.S. government shutdown caused some investors to move money into alternative assets. When government operations slow or economic uncertainty grows, investors often turn to decentralized assets like Bitcoin as a form of protection.

Finally, market momentum itself plays a big role. As prices climb, new buyers enter, creating a feedback loop that drives Bitcoin even higher.

Despite this, analysts warn that volatility remains high. Sharp corrections are still possible as traders take profits or respond to changing policies.

The Environmental Side of Bitcoin

While the price surge excites investors, it also renews focus on Bitcoin’s environmental impact. Mining Bitcoin uses a lot of energy. That energy demand produces a significant amount of carbon emissions.

Estimates show that the Bitcoin network consumes around 175 to 180 terawatt-hours (TWh) of electricity each year. This is similar to the yearly power use of countries such as the Netherlands or Argentina, and even more than Norway.

That level of energy use leads to about 98 million tonnes of CO₂ emissions every year. To put that in perspective, that’s roughly the same as the total annual emissions of some smaller developed countries.

• Each Bitcoin transaction can generate hundreds of kilograms of CO₂ (672 kg of CO₂), roughly the same as driving a gasoline car for more than 1,000 miles.

Globally, data centers and crypto mining together now use around 2% of the world’s electricity. Their combined emissions account for nearly 1% of global carbon output. If mining continues to grow, this share could rise further, raising questions about whether such growth is sustainable in a net-zero world.

Beyond the Blockchain: The Hidden E-Waste Problem

The environmental footprint of Bitcoin doesn’t stop at electricity. Mining requires powerful machines called ASICs (Application-Specific Integrated Circuits). Producing these machines consumes a lot of materials and energy.

Mining hardware becomes outdated quickly, often within one to two years. Newer models are more efficient, forcing miners to replace old machines. This creates a steady stream of electronic waste (e-waste).

A study from the United Nations University found that global e-waste could exceed 75 million tonnes per year by 2030, and crypto mining adds to this problem.

Building the machines also requires rare minerals like lithium, nickel, and copper. Extracting and refining these resources can harm local ecosystems and produce toxic waste. Manufacturing contributes up to 80% of the total lifecycle impact of some mining systems.

These factors mean that even before a Bitcoin is mined, environmental costs are already being paid.

Bitcoin’s Race Toward Renewable Power

In response, parts of the Bitcoin industry are shifting toward cleaner energy. Reports suggest that by mid-2025, about 52% of Bitcoin’s power mix will come from renewable or low-carbon sources like hydropower, wind, and solar.

Some miners have built facilities near renewable energy plants, using excess energy that would otherwise go to waste. Others buy carbon credits or join programs to offset their emissions.

For example, miners in Iceland and Norway already rely almost entirely on geothermal and hydropower, giving them some of the cleanest operations in the world. In Texas, where many U.S. miners operate, some companies now run flexible systems that shut down during peak electricity demand, helping stabilize the power grid.

However, not all mining is clean. Many sites in countries like Kazakhstan or regions in the U.S. still depend on coal or natural gas. These differences make it harder to calculate the true carbon footprint of the entire Bitcoin network.

Regulators Step In: Can Bitcoin Go Green Under Pressure?

As Bitcoin grows, so does pressure from regulators and ESG-focused investors. They want more transparency about how Bitcoin is mined and how much carbon it emits.

Some governments have discussed banning or limiting mining in areas with high emissions. However, bans can push miners to relocate to countries with dirtier energy, which increases global emissions instead of reducing them — a problem known as carbon leakage.

A more balanced solution could be a carbon tax on mining energy use. A report from the International Monetary Fund (IMF) suggested that a small tax — around $0.05 per kilowatt-hour — could both reduce emissions and generate government revenue.

Meanwhile, new frameworks for carbon intensity labeling are being discussed. These would give each cryptocurrency a score showing how clean or dirty its energy use is. Such tools could help investors choose more sustainable digital assets.

Institutional investors are also demanding better disclosure. They want mining companies to report their power sources, total energy use, and steps taken to reduce emissions. Without clear data, Bitcoin may find it difficult to fit into portfolios that follow ESG principles.

A Turning Point for Bitcoin’s Future

Bitcoin’s climb past $126,000 marks a major moment for the digital asset. It confirms that investor appetite remains strong and that Bitcoin has matured into a key part of the global financial system.

But the environmental costs are also becoming clearer. To remain part of a sustainable economy, the Bitcoin industry will need to:

• Use cleaner energy sources.
• Improve mining efficiency and reduce power per transaction.
• Extend hardware lifespan and recycle old machines.
• Increase transparency about emissions.
• Work with regulators on smart climate policies.

If these steps are in place, Bitcoin could continue to grow while shrinking its environmental footprint.

In the long run, balancing profit and planet will define Bitcoin’s role in the new financial era. Its future success will depend not only on market prices but also on how responsibly the network manages its impact on climate and energy systems.