UN sees blockchain technology as tool to fight climate crisis

Amid ongoing concerns over Bitcoin’s carbon footprint, the United Nations has said that cryptocurrency’s underlying technology has massive potential for fixing global issues such as climate change.

The U.N. will keep exploring the uses of blockchain technology as a way to fight the climate crisis and help reach a more sustainable global economy, according to an article published on the official U.N. website on Sunday.

U.N. experts are confident that “cryptocurrencies and the technology that powers them can play an important role in sustainable development, and actually improving our stewardship of the environment.” Specifically, the article points out a number of environmental and sustainability benefits associated with blockchain, including its power to enable transparency and resistance to fraud, climate finance and clean energy markets.

Citing the U.N. Environment Programme’s partnership with the Technical University of Denmark, the article states that data on harmful greenhouse gas emissions is unreliable and incomplete in many countries. In providing an immutable record of carbon data, blockchain solutions can provide a transparent way for nations to take action to reduce their impact on the climate.

Blockchain technology can also be an important part of driving renewable energy sources such as wind and solar power by providing a tool to create clean energy markets. “As these sources are, by their nature, intermittent and decentralized, new forms of energy markets are needed,” the article notes.

The U.N. emphasized that cryptocurrencies are still in their infancy, and there are still many technological and political challenges to overcome, including environmental issues as well as volatility:

“If the most vulnerable are to benefit from the promise of blockchain technology, and if it is to truly make a positive impact on the climate crisis, more technical research is needed, as well as more international dialogue, involving experts, scientists and policymakers.”

Related: Banking system consumes two times more energy than Bitcoin: Research

Minang Acharya, one of the authors of UNEP’s brief on blockchain applications, urged that the U.N. should continue experimenting with blockchain to learn more about its environmental-friendly implications. “This is likely to improve our UN-wide knowledge on blockchain, our understanding of the environmental and social implications of mining operations, and improve our chances of coping with any problems the technology may bring in the future,” Acharya said.