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2020-11-12

Blockchain as a tool for achieving sustainable development

The World Economic Forum, or WEF, believes that blockchain is a key element of sustainable digital finance - a new paradigm that combines emerging technologies with environmentally conscious business models.

In a new report published on Wednesday, Karin Oertli, Executive Director of UBS, lists blockchain technology along with artificial intelligence, mobile platforms and the Internet of Things as cornerstones of digital finance. These technologies, combined with environmental, social and governance frameworks, can help governments and corporations achieve their lofty sustainability goals.

Although annual carbon emissions continue to grow globally, western countries appear to have reduced their carbon footprint from peak levels. CO2 emissions in Europe increased in the early 1990s and then decreased over the next decade. In 2007, just before the global financial crisis, emissions peaked in the United States.

The Blockchain narrative on sustainable development is a significant departure from conventional criticism of Bitcoin. As the first Blockchain protocol, Bitcoin took its share of the heat for its consensus on the drain on resources.

Attempts to assess Bitcoin's environmental impact vary, but a report from last year's MIT technology review suggests that miners can pump out as much CO2 as Kansas City annually.

In 2018, a widely published study in Joule showed that the Bitcoin network uses the equivalent of a quarter of Australia's electricity.

Nevertheless, organizations such as the OECD believe that blockchain technology exploits key aspects of transparency, data control capabilities, process efficiency and automation that can "drive the system changes needed for a sustainable infrastructure.

As the WEF points out, some of the more than 1,200+ "climate technology" startups to be launched from 2013 have used blockchain and other new technologies.