65% of all Bitcoins in circulation come from China, according to the South China Morning Post. Attracted by cheap energy, bitcoin miners have clustered farms of computers in the country's most distant reaches-all the while using up tremendous amounts of energy in the process.

One region, Inner Mongolia, has found itself in the crosshairs of Chinese regulators. No later than April, officials will shut down all new and existing mining operations in the region.

To give you a sense of scale for the crackdown, Inner Mongolia produces 8% of all the world's bitcoin while the U.S. produces just 7.2%. So imagine if the entire U.S. mining network went offline, and you can imagine what effects this could have on the bitcoin ecosystem.

China is not alone in its concerns about bitcoin mining. Governments worldwide are grappling with bitcoin's immense carbon footprint - a footprint that will only grow in size as mining becomes more efficient.

First, why is mining bitcoin so energy-intensive? Mining is the process by which bitcoin verifies all transactions. Transactions are grouped into blocks, and these blocks are then chained together in a blockchain. Computers must solve mathematical puzzles to provide "proof of work" and ensure that each transaction is consistent with other blocks long the chain, according to CNBC. Miners themselves then earn bitcoins as a reward for renting out their computers to solve these problems and keep the blockchain secure.

The amount of energy consumed in the mining process is tremendous. According to researchers at Cambridge, if Bitcoin were a country, it'd consume 128 Terawatt hours annually, which is more energy than Argentina uses in a year, according to the BBC. And as the price of bitcoin increases, so does its carbon footprint, according to Michel Rauchs, one of the Cambridge researchers.

Why is this? As technology improves, mining should become more efficient and therefore take up less energy. But in fact, the opposite is true.

This is because of something called the Difficulty Adjusted Algorithm (DAA). This algorithm automatically adjusts the difficulty of the mathematical puzzles computers are tasked with solving based on how quickly they solve them. Therefore the better computers get at solving these problems, the more difficult and more energy-intensive the mining process becomes.

"This means that Bitcoin's energy use, and hence its CO2 production, only spirals outward," David Gerard, author of "Attack of the 50 Foot Blockchain," told the BBC. "So more efficient mining hardware won't help-it'll just be competing against other efficient mining hardware."

As of January of this year, the bitcoins mining network's speed stood at an all-time high, and so did the DAA. As bitcoin surges from high after high, more miners will compete by investing in more powerful hardware, which will only broaden bitcoin's carbon footprint.

As Wall Street institutions and corporate giants like Tesla (TSLA  ) convert their cash to bitcoin, questions will inevitably arise about the ethics of investing in a currency that strains energy grids and pollutes the atmosphere.

So far there are no clear answer to these questions.