Climate groups push together for greener bitcoin
Environmental groups just launched a campaign aimed at pressuring bitcoin miners to adopt more climate-friendly practices.
Why it matters: Verifying and recording transactions involves power-hungry computing equipment, spurring fears about growing CO2 emissions.
Driving the news: Greenpeace and the Environmental Working Group lead the "Change the Code, Not the Climate" campaign.
- Chris Larsen, the billionaire co-founder of the digital payments company Ripple, personally provided an initial $5 million.
- Former Sierra Club executive director Michael Brune is advising the campaign.
- It launched with digital ads in the Wall Street Journal, New York Times, Facebook and elsewhere.
Zoom in: Activists want bitcoin miners to ditch the "proof of work" process for validating transactions.
- They point out that bitcoin rival Ethereum is transitioning to code that requires vastly less energy.
Reality check: It's a steep and maybe impossible uphill climb, says Axios' Brady Dale, who adds:
- The two leading blockchains have wildly different cultures. Yes, Ethereum is shifting to a new consensus mechanism but it also launched without a supply cap (the limit of 21 million bitcoins is hard-coded in). They are fundamentally different projects that attract different crowds.
- Proof-of-work has persevered in a hyper adversarial environment since 2009. Bitcoin changes very slowly anyway, but that probably never will.
Threat level: "Some researchers estimate that cryptocurrencies use more electricity each year than many individual countries in the world, including some industrialized nations," states a recent White House solicitation for input on crypto's impact.
What's next: One goal is convincing investors to apply pressure. “Goldman Sachs, BlackRock, PayPal, Venmo, Fidelity — there are lots of companies we anticipate will be helpful to this effort," Brune tells Bloomberg.