The World Economic Forum (WEF) believes that blockchain technology is a key element for sustainable digital finance. A new paradigm that combines this emerging technology with business models that care about the environment.
In one new report publishes the UBS executive on Wednesday, Karin Oertli listed blockchain technology together with artificial intelligence, mobile platforms and the Internet of Things as the cornerstone of the digital financial world. These technologies are combined with the criteria of environmental, social and corporate governance (ESG for the acronym in English) They could help governments and businesses meet their lofty sustainable development goals.
“We believe that sustainable digital finance will play an essential role in efficiently channeling this capital to drive innovation, growth and job creation while supporting the transition to a low-carbon and sustainable economy.”
Oertli’s comments match those previous research by the Organization for Economic Co-operation and Development (OECD), where they advertised blockchain technology as “Digital Enabler for Sustainable Finance” and the reduction of CO2 emissions. The OECD said:
“The main characteristics of blockchain and other DLTs can enable deeper technology integration, standardization and the possibility of new business models.”
Although annual CO2 emissions continue to increase worldwide, Western nations appear to have reduced their carbon footprint from their peak. CO2 emissions in Europe peaked in the early 1990s before declining in the following decade. The United States peaked in 2007 just before the global financial crisis.
The story about the sustainable development of blockchain technology is a significant change from the conventional criticism of Bitcoin. As the first blockchain protocol Bitcoin has received a fair share of criticism for its proof of work that allegedly depletes natural resources.
Attempts to assess Bitcoin’s environmental impact vary, but a report from last year’s MIT Technology Review suggested this Miners may emit as much CO2 as Kansas City annually.
In 2018, a widespread study in the Joule magazine showed that The Bitcoin network consumes the equivalent of a quarter of Australia’s electricity.
However, organizations like the OECD believe so Blockchain technology leverages key aspects of transparency, data verifiability, process efficiency, and automation that “can drive the systemic changes required to deliver sustainable infrastructure”.
As refers to the WEF, some of the more than 1,200 “Climate Tech” companies founded since 2013 have made use of blockchain technology and other emerging technologies.
The World Economic Forum has not responded to our request for comment at the time of this writing.