“Just because mining Bitcoin uses energy, doesn’t immediately mean that it’s wasteful, to come to that conclusion would require a value judgment of the activity to begin with.”Several years ago, a fund manager from Hong Kong who was considering an investment in my fund shot at me, “Did you know that mining Bitcoin uses as much electricity as Belgium?”
Somehow, investments in cryptocurrencies in general, and Bitcoin in particular, have been singled-out as “uninvestable” for failing the “E” criteria among investors with strict environmental, social and corporate governance concerns as part of their investment mandates. Image: Olya Kobruseva/PexelsFor instance, few would argue that street lighting and heating homes are ignoble pursuits which the world must wean itself of.
Which is why, if mining Bitcoin is considered an activity worth pursuing, further investigation needs to be made as to the sources of the electricity it’s consuming. Nevertheless, it’s difficult for ESG-conscious investors to determine if investing in a particular cryptocurrency adds to environmental costs.
Proof-of-stake blockchains rely on holders of cryptocurrency to use their “stakes” to secure the blockchain by relying on algorithms which randomly select such “stakes” to validate transactions and secure the blockchain. But even Ethereum is evolving and later this year will attempt to make one of the most ambitious shifts for an established blockchain ever, moving from the energy-intensive proof-of-work to the far more energy efficient proof-of-stake.
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Source: Cointelegraph - 🏆 562. / 51 Read more »
Source: Cointelegraph - 🏆 562. / 51 Read more »