Manuel Silva Martinez, General Partner of Mouro Capital (formerly Santander InnoVentures), has distributed a note on Bitcoin and the environmental impact of the world’s most popular crypto. Martinez is criticizing BTC just as it rockets to new all time highs – currently trading at around $64,000 and a market cap of over $1 trillion.
According to the VC, a single transaction of Bitcoin has the same carbon footprint as 680,000 Visa transactions or 51,210 hours of watching YouTube.
“The conversation around Bitcoin’s negative environmental impact isn’t new, but as its value soars past $64,000 (as of 14th April), and, most importantly, its trading volumes are at a record high, it is becoming harder to ignore,” said Martinez, noting that Bitcoin’s energy use this year will rival that of all cloud-computing data centers globally.”
Martinez believes that there should be a focus on developing a cleaner solution so that a larger portion of Bitcoin mining and trading relies on clean energies and there is less to offset in the first place. Another option is to create cleaner protocols.
“For example, at the beginning of this year, enterprise blockchain company Ripple pledged to achieve carbon net-zero by 2030, supported in large part by partnering with the XRP Ledger Foundation in order to decarbonize public blockchains. Ripple is not the only one in that category, either. There are considerations for a range of stakeholders here:
- Should the public be made more aware of the ecological implications of each protocol (especially retail traders, who may have less knowledge of the technical intricacies of the assets they trade-in)?
- Similarly, as blockchain adoption goes increasingly mainstream for enterprise applications, it would be interesting to see the extent to which ecological implications are taken into account as companies chose technological providers and partners –should there be more awareness around that too?
- I also wonder whether regulators should show more support for cleaner protocols – without overregulating or impairing competition in this nascent space. Regulators are driving some of the growing public awareness, both at the individual trader level and that of SMEs and larger enterprises that are transforming their infrastructure through blockchain.”
Martinez also pitched the idea that individuals who have benefited from the outsized wealth creation generated by Bitcoin could give back to the community and invest in cleantech.
“I would imagine broad support from large niches of public opinion in the short term. This could be achieved through a combination of private initiative and philanthropy, but also some decisive public policy action in that sense. Regardless of how to instrument it, this would turn the problem into part of the solution, let alone generating massive positive externalities that could benefit a number of crucial aspects of mankind, beyond tactical Bitcoin operations.”