When the fever for non-fungible tokens broke out earlier this year, many climate-conscious artists voiced their opposition to the power consumption of Ethereum. In May, Elon Musk lowered the price of Bitcoin (BTC), Citing grid energy consumption as a reason for Tesla to withdraw its plans to accept BTC as payment for its electric cars.
Both events have sparked heated debate inside and outside the blockchain community. In particular, the arguments focus on two areas: Bitcoin’s energy consumption and its dependence on climate-damaging fossil fuels over renewable energies and, secondly, the advantages of a blockchain platform over another that generally focuses on consensus models and promotes the proof of stake as the most environmentally friendly option.
Every debate is full of arguments for both parties. If the IPCC is right, the need for drastic action to reverse some of the damage cannot be overestimated. To do this, you need to focus on the positive uses of the blockchain.
Use the strengths of the blockchain
One major way the blockchain’s impact is already significant is its ability to capture large amounts of energy that would otherwise be wasted, added and turned back on for greater benefit. The crowdsourcing of wasted energy is in line with the principles of the circular economy, which eliminates the culture of waste in order to reuse the available resources as much as possible. And computing power is an example.
Whether on a private laptop or on a business server outside of office hours, a lot of idle computing power is wasted on hardware, especially when it’s not in use. At the same time, there is a huge need for computing power that is being met by companies like Amazon Web Services, who are constantly building new data centers to meet this need.
Blockchain networks, like Cudos’ decentralized cloud computing platform, divert excess processing power from inactive computers and make better use of it, reducing waste. Other networks like Filecoin or Blood cell You focus on storage services, but the principle remains the same.
Decentralization of the energy network
Other projects use this concept to decentralize power grids. Brooklyn Microgrid is a hyperlocal initiative that enables “prosumers” (producers and consumers) of solar energy to sell their surplus by channeling it into a microgrid where other participants can buy it. It’s the act local, think global type of project that shows that anything is possible when you’re ready to start from scratch.
In Vienna, the government had previously funded an initiative that allowed citizens to earn token-based rewards for identifying sources of heat loss that could be fed back into the electricity grid. A slightly different twist on the same decentralized theme, but with the same principles of using blockchain technology for the common good.
Trusted green credentials
Blockchain technology also plays a key role in bringing transparency and accountability to governments and businesses for their role in combating climate change. Transparency in the area of ESG (environmental, social and governance) is currently at the top of the CFO’s agenda after the EU regulation on the disclosure of sustainable finances was introduced at the beginning of the year. In the broadest sense, the ordinance requires banks and financial institutions to classify their investment products according to their ecological standards.
Using blockchain to store and verify this information would increase the visibility and confidence investors can put in products with ESG credentials. One can easily envision a future where consumers and businesses can choose any type of organization on the blockchain based on the algorithmic ESG ranking.
Being the “least bad” blockchain platform will no longer be enough, and the community is far from defenseless in the face of the climate emergency. It has powerful technology as well as some of the best, smartest, and most innovative thought leaders in the world.
It is clear that blockchain technology can be applied to a variety of positive use cases that add more to the green cause than they take from it. And blockchain technology is a stronger argument for its applications in the environment than against it.
The viewpoints, thoughts, and opinions expressed herein belong solely to the author and do not necessarily reflect the views and opinions of Cointelegraph.
Matt Hawkins is the founder and CEO of Cudo Ventures, a global provider of cloud computing and monetization software, and Cudos, a decentralized cloud computing network that bridges the gap between cloud and blockchain by recycling unused computing power in the world. He previously founded C4L in 2000, which was acquired in 2016 and was one of the UK’s fastest data center ISPs supporting approximately 1% of UK internet infrastructure on Sunday Times Tech Track 100, UK Technology Fast 50 and Technology Fast 500 EMEA by Deloitte and many more.