The Ultimate ESG Asset: Bitcoin
In a recent thread on Bitcoin’s environmental, social, and governance (ESG) impact, Daniel Batten, a leading BTC environmentalist and co-founder of CH4 Capital, presented a compelling case for the cryptocurrency. Batten used four charts to highlight Bitcoin’s sustainability compared to other major industries. According to Batten, Bitcoin is the ultimate ESG asset for the following reasons:
Renewable Energy Dominance
Batten emphasized that BTC mining has become the “single most sustainably-powered global industry in the world.” Data shows that 52.6% of the energy used for BTC comes from renewable sources. This surpasses other sectors such as banking, industry, agriculture, gold, and iron & steel.
Consistent Emission Levels Amidst Growth
BTC’s unique capability to maintain its emissions despite significant growth is highlighted in the second chart. Over the past four years, BTC’s hash rate increased by 475%, its price rose by 163%, and the total number of users grew by 289%. Yet, its emissions decreased by -9.4%, an achievement unmatched by any other industry.
Lowest Emission Intensity
Bitcoin has halved its emission intensity within four years and currently has the lowest emission intensity among major global industries. The emission intensity of Bitcoin stands at 299 g/KWh, significantly lower than iron & steel, agriculture, gold, industry, and banking.
Decentralized Energy Source
The final chart illustrates Bitcoin’s diversified energy composition. Unlike other industries that heavily rely on coal-powered grids, Bitcoin mining is not anchored to the global grid powered by coal. This makes Bitcoin the only major industry where fossil fuel is not the primary source of power.
False Information Continues To Circulate
It is crucial to foster a deeper understanding of Bitcoin and address potentially misleading narratives. Recent campaigns and academic studies must be scrutinized for accuracy. While the recent MIT study on Bitcoin mining is commendable, Batten raised concerns about outdated data and non-representative datasets. He emphasized the need for more exhaustive and accurate research models that involve direct engagement with industry stakeholders.
Hot Take: The Sustainability of Bitcoin
Daniel Batten’s presentation sheds light on the sustainability of Bitcoin as an ESG asset. With its dominant use of renewable energy, consistent emission levels amidst growth, lowest emission intensity, and decentralized energy source, Bitcoin demonstrates its environmental responsibility. However, it is essential to critically evaluate information circulating about Bitcoin’s impact and ensure that accurate and comprehensive research models are used to understand its nuances.
At press time, BTC traded at $26,102.
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