The ongoing debate about crypto’s energy cost, sustainable finance’s greenwashing, and Aspiration launches tree-planting credit card

Tearsheet’s Green Finance newsletter is about the intersection of money and the environment. We’ll be in your inbox every other week, and share what we’re currently thinking about, and what’s been happening at three key areas in the intersection: corporate responsibility, blockchain, and green products and services. You can subscribe here.

With a $2+ trillion market cap, crypto is an unignorable financial force. The amount of energy it takes to power crypto is a challenge, or an opportunity -- depends who you ask. Not too long ago we spoke to Paxos’ CEO Charles Cascarilla about the common likening of crypto’s energy cost to that of a whole (small) country. He said, ‘We spend more energy digging gold out of the ground than mining crypto.’ And in essence -- it’s worth it. 

In a recent NYT podcast, data scientist Alex de Vries called 'sustainable crypto mining' a paradox, an impossibility. Mining currencies via proof of work -- such as with Bitcoin and Ethereum, which have the largest market cap today --  is a process fundamentally based on useless calculations, ie. energy waste. These digital assets come with a very tangible environmental impact.

Source: Source: Digiconomist & Visual Capitalist

Currencies validated via proof of stake, on the other hand, don’t tax the environment nearly as much, and are competing for audience favorites, according to Tezos creator Kathleen Breitman. 

So, is crypto's promise of economic democracy worth the energy cost? Do we just need to put it in perspective? Or, will we realize in hindsight that crypto mining has been waging unnecessary costs on our environment, and that the market doesn't always know best?

Corporate responsibility

• JPMorgan shares patents to spur low-carbon technology development
• Rich countries fall $10 billion short in climate finance pledges
• Green investing looks to clean up the maritime industry
• UK firms will have to disclose climate impact
• Legal eye for detail will help battle sustainable finance ‘greenwash’
• Reaching net-zero will require $5 trillion every year for the next 30 years, says BoA report
• Banks in Asia are going green to reduce their carbon footprint
• Sphere raises $2 million to help employees lobby for green 401(k) plans
• Banks back new Singapore sustainability platform for SMBs
• Exchanges and index providers join net zero alliance

Blockchain

• Researchers at IST Austria develop building blocks for sustainable blockchain
• Could blockchain be the key that unlocks the SDGs?
• Ripple and Nelnet announce $44 million clean energy fund for a more sustainable future
• Open Mineral raises $33 million for metal commodity trading platform

Green products and services

• Aspiration launches first credit card, letting users earn cash back and plant trees with every purchase
• Mastercard launches global Sustainability Innovation Lab
• Crédito Agrícola Group taps Meniga for carbon tracking tool
• Santander cards go green in Spain
• Sugi lets users offset carbon impact of investments in the UK
• HSBC brings first-of-its-kind sustainable finance product suite to Canadian businesses