Discussions around crypto regulation obscure the negative environmental impacts of crypto, with sustainability concerns being overlooked, according to new research.
Data from regulatory technology provider CUBE showed that only 0.1% of crypto regulatory issuances in 2022 were focused on sustainability. The data does not take into account the EU MiCA regulation adopted last week.
“While global regulators are advocating for a greener financial system and actively working to bring cryptocurrency under its wing, the negative environmental effects of crypto mining have clearly been overlooked,” the research states.
The energy used to mine cryptocurrencies, a process that uses powerful computers to solve complex puzzles to mine cryptocurrencies, consumes a substantial amount of energy and has a detrimental impact on the environment.
CUBE Global CEO Ben Richmond said: “In order to resolve the conflict between cryptocurrencies and climate risk, global regulators will need to push regulation forward to ensure both can thrive without harming the other. “
He also said it should be done on a global scale to avoid “a complex sustainability issue and “a web of regulatory silos across multiple jurisdictions that will retard rather than inspire innovation.”