Crypto Regulation Overlooks Sustainability Issues
Discussions around crypto regulation gloss over the negative environmental impacts of crypto, with sustainability concerns overlooked, new research shows.
Data from regulatory technology provider CUBE showed that just 0.1 per cent of crypto regulatory issuances in 2022 were focused on sustainability. The data does not take into consideration the EU’s MiCA regulation agreed last week.
“Although global regulators are advocating for a greener financial system and actively working to bring cryptocurrency under their wing, the negative environmental effects of mining crypto have been overlooked,” the research said.
The energy used to mine cryptocurrencies, a process that uses powerful computers to solve complex puzzles to extract cryptocurrencies, consumes a substantial amount of energy and has a detrimental impact on the environment.
CEO of CUBE Global, Ben Richmond said, “To solve the conflict between cryptocurrencies and climate risk, global regulators will need to drive forward regulation to ensure that both can thrive without undermining the other.”
He also said that this would need to be done on a global scale to avoid “a complex sustainability issue, and “a web of siloed regulation across multiple jurisdictions that will stunt rather than inspire innovation.”