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Cryptocurrencies are generally not associated with eco friendliness. Indeed, bitcoin issuance production, which rivals that of some countries and even threatens to hamper climate action, has done a lot to tarnish the image of these advanced forms of finance.
In light of this, an alliance of research groups and private companies announced this week that they are pooling their resources with the intention of completely decarbonizing all crypto currencies by 2040.
The bodies that formulated the proposal, known as, say that the transparency that is by definition built into cryptocurrencies makes them ideal tools for bringing the confidence in decarbonization efforts. The agreement, in turn, urges cryptocurrency communities to work collaboratively to make the industrye “100% renewable” cryptocurrency.
"Inspired by the Paris Climate Agreement," the groups said in a joint statement, "the agreement brings together the crypto and fintech industry (fintech ) to build a sustainable future for global finance. ”
The groups hope the effort, if successful, will attract new customers to use crypto and secure the place of digital currencies in the vast majority of global finances. rkets.
Approach industry as a whole
This initiative, supported by the, is being carried outby nonprofit energy research organizations and the, as well as the, which campaigns for the modernization of financial regulations. Signatories to the deal range from digital asset investment firm Coinshares to French utility company Engie.
Jules Kortenhorst, CEO of the Rocky Mountain Institute, explained to Hfrance.fr.com why the deal is important.
"The role of financial services in driving transformative change in zero emissions, the future of 100% renewable energy has reached a critical point," said Kortenhorst. "But one organization cannot impact the level of change required - it takes an industry-wide coalition.
" We have reached a turning point, the crypto taking a permanent place in global finance, "he continued." Now, crypto is also playing a leading role in building a more sustainable future andscalable for global finance in the net zero economy.
Walter Kok, CEO of Energy Web, insisted that all the ingredients needed to decarbonize cryptocurrency already exist: what is missing is collective action.
“We have the technical solutions to decarbonize blockchains,” Kok said. “What the industry doesn't yet - and needs - is a concerted effort. The accord brings together the right tools and public structure necessary to achieve our goals, and we hope the recognition of our supporters around the world will inspire others to join us in shaping our future in renewable energy. "
One of these things is not like the others
L Bitcoin mining has resulted in millions of tons of carbon emissions thanks to its 'proof of work' consensus mechanism to validate transactions and extract new tokens. This has led bitcoin miners to go to war for dwindling rewards by deploying more and more power-hungry circuits to do their math. Chinese researchers this week revealed that by 2024, bitcoin mining could be responsible for 130 million tonnes of carbon emissions per year, roughly the same as the Czech Republic.
But not all cryptocurrencies are not based on the proof-of-work mechanism: proof-of-stake mechanisms, for example, are based on coin ownership rather than computational energy, meaning they can be a lot more energy efficient.rage the development and investment in crypto-currencies based on these mechanisms. It is this mechanism that the second most popular cryptocurrency, Ethereum, with the aim of drastically reducing its emissions.
The deal stresses that the plan is not to dilute existing cryptocurrencies or create currencies " green pas soon as "not green". "We want cryptocurrencies like BTC [bitcoin] and ETH [Ethereum] to remain 100% fungible," the agreement states. In other words, the fact that cryptocurrency tokens hold the same value regardless of their owner or history is one of their main advantages.
Nigel Topping, a longtime campaigner for zero-carbon trading initiatives in the UK and UK high-profile champion for climate action at this year's UN COP26 summit, Said of the deal, “In addition to urgently phasing out future emissions, this industry is uniquely positioned to meet its historic emissions debt. . The very nature of blockchains allows for historical system-wide transparency, making crypto issuance debt a ripe target for carbon dioxide removal solutions. "
" This is a unique chance to clean up pubonly the past, reject future emissions, and push the boundaries of climate leadership, ”he added. Even in the case of proof of work mechanisms like bitcoin, l Accord says a lot more can be done to reduce emissions, starting with an effort to “leverage the transparency of blockchains themselves to measure how well n etworks are powered by renewable energy.” This can facilitate shifting such systems to low- or zero-carbon energy supplies.