Is it possible to green bitcoin? Filecoin thinks so

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January 18 2022
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The debate around crypto and carbon emissions calls for greater transparency.

Is it possible to green bitcoin? Filecoin thinks so

The conversation around cryptocurrencies isn’t going anywhere in 2022, and neither is the debate around the environmental costs.

Speaking to nestegg, research scientist and Filecoin green project lead Alan Ransil said that investors should hold Web3 projects to the same standards that they do traditional finance when it comes to measuring their sustainability credentials.

Mr Ransil said that new technologies like the blockchain have had little impact on the need to “rapidly decarbonize then aim for negative emissions and environmental remediation”.

“The Intergovernmental Panel on Climate Change has shown that we can no longer settle for zero emissions,” he said.

Pointing to organisations like The Crypto Climate Accord, he emphasised the value of developing new tools that allow investors to apply the Greenhouse Gas Protocol (GHGP) to their crypto portfolios.

“The momentum that matters right now in the renewable crypto space is an increasing number of proof points enabling that verifiability,” he said.

In the case of Filecoin, Mr Ransil said it is possible to “unambiguously” map on-chain activity to storage provider energy use and renewable energy consumption. The hope here is this approach will set a new standard for environmental verifiability in other crypto projects and systems.

Mr Ransil noted that the company is “certainly not claiming that crypto broadly as it exists today is environmentally sustainable, but that fully embracing the values of crypto and Web3 will upgrade standards for sustainability beyond what exists in the legacy economy”.

Asked whether the most environmentally costly of all blockchain technologies, bitcoin, could ever make the pivot towards sustainability, Mr Ransil was optimistic.

“We are building tools to verifiably decarbonize the Filecoin ecosystem, and to enable projects beyond Filecoin – including bitcoin and the legacy economy – to do the same,” he said.

Mr Ransil noted that the business case for colocating BTC miners with renewables was outlined in a recent joint paper by Jack Dorsey’s Square and global asset management business ARK Invest.

With BTC miners increasingly likely to use solar and other renewables as they fall in cost, the argument for the two becoming more and more intertwined in the future is easy to see.

That being said, Mr Ransil conceded that the path towards renewable bitcoin is one that would be determined by the wider bitcoin community.

“We at Filecoin Green just want to make sure that renewables claims across crypto are backed with publicly verifiable data,” he said.

About the author

Fergus is a journalist for Momentum Media's nestegg and Smart Property Investment. He likes to write about money, markets, how innovation is changing the financial landscape and how younger consumers can achieve their goals in unpredictable times.

About the author

Fergus is a journalist for Momentum Media's nestegg and Smart Property Investment. He likes to write about money, markets, how innovation is changing the financial landscape and how younger consumers can achieve their goals in unpredictable times.

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