Although 2021 has been the best year yet for cryptocurrency, Bill Gates’ comments with the New York Times were damning and shed light on an issue that hadnt been broached.
There has been a clear uptrend in the volume of crypto users, with the industry responding to the demand. The sheer number of fintech companies, providing cryptocurrency exchange platforms, payment systems, and crypto wallets has sky-rocketed.
We have seen major payment services like Visa and BNY Mellon announce cryptocurrency projects, as well as Elon Musk now announcing that his payment system PayPal will be launching a crypto checkout service.
Although these kinds of moves are monumental for the crypto industry, the recent revelation regarding the high data usage of 0.5% of the total global electricity consumption has rallied many in the community to find a solution.
What can be done?
A growing conversation around the environmental impact of cryptocurrency and all associated activities hasnt changed the trajectory of the industry. But, with a cascade of NFT purchases for millions of dollars across various areas of society, notably from the art world, it seems like blockchain is only going to go up in consumption levels.
Many artists, including British artist Damien Hirst, have turned to NFT sales of artwork during the pandemic. One such artist found that a project he sold consumed as much energy as his studio does in two years, which shocked the man as hes a passionate environmentalist.
The environmental problem wont go away. So, mitigating the impact on climate change is an urgent issue.
The crypto industry has the interest of people of all ages across the globe, which means they could be the pioneers of change. Pushing global society in the direction of renewable energy and accelerating the transition from fossil fuels to clean energy. Especially at a time where cryptocurrency is in the crosshairs of many environmentalist groups and campaigners looking to reduce carbon emission.
There is a dark cloud hanging over the cryptocurrency industry at the moment. If somehow they can position themselves as leaders in the carbon-neutral space as a fintech industry, that would drastically change public opinion. With various carbon removal solutions already tabled by startup businesses, the options are there.
There has been a clear shift in consumer interests when it comes to purchasing preferences, as many are now looking to deal with companies acting responsibility in relation to social and environmental interests.
The industry has reacted quickly, with energy-focused operations already gaining momentum. One of the suggestions has been that crypto leaders should invest money into technologies that work to counter the effects of climate change. One such suggestion is reforestation, which would help to capture air and diminish impact.
All modern companies are expected to meet environmental standards and make a commitment to carbon neutrality. While this isnt something that is always adhered to, it is something thats in place. This should be no different for cryptocurrency.
Businesses can purchase carbon removal APIs to embed negative emissions into products. This technology is available. If the industry is serious about growing its user base, certain major players should come forward and lead the way enter, Elon Musk.
There are some cryptocurrencies that have a higher energy consumption than others, Bitcoin is one of them, but all crypto transactions leave a carbon footprint. The creators of cryptocurrencies have a role to play in this as well. As a collective the crypto industry could be the catalyst for change. This could really be the start of something special.