Cryptocurrency Insights North America

A Third of Americans Believe Bitcoin Mining Has No Impact on the Environment

Bitcoin has received a bad a rep in recent years for its energy consumption when mining coins. While some have become aware of the environmental impact mining cryptocurrencies, especially Bitcoin, can have, the majority of investors are still unaware of it according to Forbes Advisor.

Research from the investing experts has revealed that 84 per cent of Americans do not believe that Bitcoin investments are a threat to the environment. Such findings are startling, in comparison to the great impact that it truly has on energy consumption and carbon emissions.

Those unaware of the significant damage bitcoin mining has on the environment consist of one third (32 per cent) believing there to be no impact and one quarter (26 per cent) understanding there to be a slight threat, but not significant enough to cause an impact. Meanwhile, over one quarter (26 per cent) of people believe quite the opposite, claiming Bitcoin to be good for the environment. However, the reality according to Forbes Advisor, is scarily different.

An analysis from the company lays bare that US Bitcoin miners generated 0.85 pounds of carbon dioxide per kilowatt-hour of energy used in 2020. Bitcoin mining is estimated to produce 40 billion tons of carbon dioxide, and the US accounts for more than 37 per cent of the world’s total Bitcoin mining capacity.

Joe Sweeney, managing partner at Cornerstone Wealth, says Bitcoin is a problem for any investor concerned about ESG principles.

“With so much focus on ESG investing, Bitcoin mining has never been good from an energy consumption standpoint. Of course, it’s worse today given supply constraints due to the Russia-Ukraine war,” Sweeney says.

Further insights unveiled that just over one in twenty American’s (six per cent) are aware of the great level of carbon emissions Bitcoin mining sets off. Therefore, it is imperative that investors understand the risks posed, in order to make well informed investment decisions.

The majority of Americans want environmentally-friendly investments

While many Americans are unaware of the impact that Bitcoin has on the environment, the good news is that research shows that the majority favour more environmentally friendly investments. Approximately 58 per cent of respondents who own some form of investment assets say they would avoid stocks because of their environmental impact, including 68 per cent of Gen Z and 63 per cent of Gen Y investors.

This attitude has created a great impact in the investment space in a short time. Between January – November 2021, ESG-focused funds saw a record $649billion in inflows. This is more than double the $285billion ESG fund inflows saw throughout the same time in 2019.

While this is welcoming news, research also found that 44 per cent of respondents were more concerned about a crypto investment’s potential return than its environmental impact.

When asked to state the most important factors when it comes to investing in cryptocurrency, over half (56 per cent) of respondents above the age of 77 claimed environmental impact to be a deciding factor. Meanwhile, two fifths (41 per cent) of millennials state it to be a key decision maker, whereas just 38 per cent of Gen Z name it to be a main consideration.

Moreover, when respondents were asked if they have avoided investing in certain stocks because of their environmental impact, just over half of Gen Z respondents (54 per cent) claimed they had in the past. Meanwhile, 63 per cent of the silent generation (77+) claimed they had previously, while almost two in three (61 per cent) of millennials had done so.

Further findings unveiled that the most important factor when it comes to investing in crypto for participants is the return on investment, which over two in five respondents claim to be a key consideration (41 per cent). This was followed by the cost to purchase price (39 per cent) and balancing one’s portfolio (38 per cent). Over a third of respondents (36 per cent) claim environmental impact to be a great consideration.

Author

  • Francis is a journalist and our lead LatAm correspondent, with a BA in Classical Civilization, he has a specialist interest in North and South America.

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