Wall Street must be accountable for Bitcoin mining emissions — Greenpeace

News Feed - 2024-06-14 06:06:00

Daniel Ramirez-Escudero1 minute agoWall Street must be accountable for Bitcoin mining emissions — GreenpeaceGreenpeace alleges that Wall Street titans such as BlackRock or Vanguard contribute to the environmental harm derived from Bitcoin mining.8 Total viewsListen to article 0:00OverviewOwn this piece of crypto historyCollect this article as NFTJoin us on social networksMajor financial institutions on Wall Street should be held responsible for bankrolling the emissions-heavy Bitcoin mining industry, according to a new report by Greenpeace USA.

The latest report from the environment-focused non-government organization (NGO) — Bankrolling Bitcoin Pollution — differs from previous Greenpeace papers on the Bitcoin (BTC) mining industry.

In the most recent communique, the main character is not BTC miners themselves; but Wall Street and the banking industry.

Greenpeace claims that big finance supports Bitcoin mining by creating economic incentives, thereby continuing the ecological threat the industry represents.

The report names Trinity Capital, Stone Ridge Holdings, BlackRock, Vanguard and MassMutual as the top five financiers of carbon pollution from Bitcoin mining companies.

According to the report, they together accounted for over 1.7 million metric tons of CO2 in 2022—equal to the emissions from over 335,000 American homes using electricity for a year.

Greenpeace stated that Bitcoin mining has grown into a large commercial industry, where companies need access to significant capital to build facilities and purchase computing equipment.

Miners rely on support from banks and asset managers to make this happen and Wall Street and the banking industry have heeded the call, eager for their share of the spoils.

The report believes companies such as BlackRock should be accountable for fostering the mining industry:“Banks and asset managers have a duty to disclose risks to their shareholders and clients who are currently missing vital information on the climate risks from Bitcoin.”

Greenpeace criticizes the lack of scrutiny of how investments from traditional finance companies enable carbon-intensive Bitcoin mining operations.

Greenpeace also states that the crypto mining industry lacks disclosure and transparency, which “enables Bitcoin mining companies to avoid accountability and obscures the scale of Bitcoin’s climate problem.”

This “lack of reputable electricity and emissions reporting” makes it hard for investors, stakeholders, and regulators to make informed decisions if they wish to follow green policies.

The NGO believes financial companies involved in Bitcoin mining should report on the emissions associated with their investments and underwriting services for Bitcoin mining companies.Greenpeace says Wall Street is financing climate change

Greenpeace said it is hypocritical that banks have green, sustainability goals on their agenda but also invest in or finance the crypto mining industry.

In the U.S.,Texas hasabsorbed a significant part of miners whoabandoned China after its pseudo-ban. The American state has rapidly become a global hub for Bitcoin miners.

Greenpeace accuses Wall Street companies of financing this new gold rush, which resulted in the construction of many BTC mining facilities. The report highlighted the case of Riot Platforms’ facility near Rockdale. According to their estimations, the mining facility offered the largest carbon emissions, according to data from 2022.

The Riot facility’s main financiers were Vanguard, BlackRock, Morgan Stanley and State Street.

Citing data from the Cambridge Bitcoin Electricity Consumption Index (CBECI), Greenpeace said that the Riot facility alone accounted for 526,000 metric tons of CO2, equivalent to the carbon emitted from 100,000 U.S. homes a year.

Greenpeace highlighted the paradox of BlackRock, a supposed leader in sustainable investment.

The NGO emphasized that BlackRock is asignatory to the Net Zero Asset Managers initiative, which includes pledging to support net zero emissions by 2050 in line with efforts to limit global warming to 1.5°C.

However, among the 540 financial institutions in Greenpeace’s study, BlackRock had the third highest carbon emissions from its investments in Bitcoin mining.

Recent: Bitcoin is no ‘silver bullet’ for money’s ethical problems

Greenpeace also said that companies with a low reputation for supporting cryptocurrencies, such as the publicly traded companies M&T Bank and MassMutual, issued loans to miners in 2022.

MassMutual lent $100 million to BTC miner Core Scientific, financing over 250,000 metric tons of CO2. M&T lent $174 million to buildTerawulf facilities, producing 31,800 metric tons of CO2.

Johanna Fornberg, the senior research specialist at Greenpeace USA, said that “top financiers like BlackRock, Vanguard, and MassMutual are enabling this carbon nightmare and avoiding disclosure or accountability of how this fits into their climate goals.”Bitcoin miner greenwashing follows the tobacco industry

Greenpeace accused the Bitcoin industry of “making false and greenwashing claims regarding Bitcoin’s environmental impact” by asserting that the supposed environmental and social benefits areboosting the renewable energy transition and aiding the energy grid.

The report compared the Bitcoin industry strategy to “a playbook from the tobacco and fossil fuel industry.” The American NGO accused Bitcoin mining leaders of publishing “misleading studies in predatory scientific journals” written by industry representatives “in an attempt to paint a green image.”

Greenpeace claims that many of these papers are “commonly written by people who work for Bitcoin mining companies or trade associations with blatant conflicts of interest” and are submitted to journals known for their poor peer-review processes. Once published, the industry sells these papers to the public as rigorous science.

The articles allege that Bitcoin’s energy-intensive mining is good for the environment by incentivizing the purchase of stranded renewable energy and providing stability to power grids. However, Greenpeace believes these ideas are either “speculative, contested, or false.”

Additionally, Greenpeace claims that some Bitcoin miners are reducing their carbon footprint artificially by “purchasing Renewable Energy Credits (RECs) and reporting ‘market-based’ emissions based on RECs and carbon offsets.”

In this way, they claim a higher usage of renewable energy and display lower carbon emissions.

Many companies use RECs; however, Greenpeace said that these market-based instruments are “notoriouslyunregulated and often do little or nothing to cut carbon emissions or spur renewable energy development.”BTC miner tax or scrapping proof-of-work (PoW)

Greenpeace believes that regulation and taxation must be used to “eliminate the huge appetite for energy” from Bitcoin miners. The United States needs “policies that make miners pay for the environmental, social, and economic costs of their operations.”

The NGO agrees with the taxationattempts of U.S. President Joe Biden’s administration embodied within the Digital Asset Mining Energy (DAME) tax. Greenpeace stated that the tax could “incentivize miners to clean-up their operations.”

For the crypto industry, Biden’s tax proposal is a clear attempt tokill the American crypto mining industry. Senator Cynthia Lummis, a Republican U.S. Senatorbehind the bipartisan vote for the SAB 121 repeal, said on X:Source:Cynthia Lummis

The U.S. elections are only five months away, and crypto regulation has become a topic of discussion in political campaigns. 

Trump ispositioning himself as the pro-crypto candidate, supporting BTC miners in the pursuit of producingBitcoin “made in the USA.” Biden’s anti-crypto stance may cost him some essential votes fromswing states, which could cause him to rethink his strong position against crypto.

Aside from tax, Greenpeace introduces another route for Bitcoin mining to remain in the U.S. Following itscontroversial Change the Code campaign, they advocate for Bitcoin to change its consensus protocol from proof-of-work (PoW) to proof-of-stake (PoS), asEthereum has done.

Recent: US Bitcoin miners silent in face of Kerrisdale ‘snake oil’ claims

The Bitcoin community and developers vehemently oppose this option, as it would destroy the decentralized form of money it represents, thereby preventing Bitcoin from remaining “sound money.”

There have been attempts to fork Bitcoin with a PoS algorithm. However, as its price graph demonstrates, the community hasn’t supported it.BitcoinPos (BPS) all-time price history. Source:CoinMarketCap

Greenpeace’s assertion that Bitcoin miners employ deceptive tactics to influence public opinion will likely ignite conflict with the cryptocurrency community. 

This friction echoes the response to Greenpeace’s recentreport, Mining for Power, which the Bitcoin community criticized for its perceived one-sided perspective and potential conflict of interest, given that the campaign is directlyfunded by Ripple co-founder Chris Larsen.# Bitcoin# Mining# Business# Proof-of-Stake# Proof-of-Work# Bitcoin Mining# Environment# Green technologyAdd reaction