A new report by Greenpeace USA is holding major financial institutions on Wall Street accountable for funding the emissions-heavy Bitcoin mining industry.
Unlike previous papers on Bitcoin (BTC) mining, the latest report titled “Bankrolling Bitcoin Pollution” shifts the focus away from BTC miners themselves to Wall Street and the banking sector.
Greenpeace alleges that large financial institutions support Bitcoin mining by providing economic incentives, perpetuating the environmental threat posed by the industry. The report identifies Trinity Capital, Stone Ridge Holdings, BlackRock, Vanguard, and MassMutual as the top five backers of carbon pollution from Bitcoin mining companies.
These institutions collectively contributed over 1.7 million metric tons of CO2 emissions in 2022, equivalent to the emissions from 335,000 American homes using electricity for a year.
According to Greenpeace, Bitcoin mining has evolved into a lucrative commercial sector, where companies require substantial capital for infrastructure and equipment. These miners rely on support from banks and asset managers, which Wall Street and the banking industry readily provide in pursuit of profits.
The report calls for financial companies involved in Bitcoin mining to disclose the emissions associated with their investments and underwriting services for mining companies. Greenpeace criticizes the lack of transparency in the industry, which hinders informed decision-making by investors, stakeholders, and regulators who aim to adhere to green policies.
Greenpeace also accuses Wall Street firms of financing the rapid expansion of Bitcoin mining in the United States, particularly in Texas, where miners relocated after China imposed restrictions on mining activities. The report highlights the role of major financial institutions in funding new mining facilities, such as Riot Platforms’ facility near Rockdale, which emitted a significant amount of carbon in 2022.
Despite companies like BlackRock being signatories to initiatives promoting net zero emissions by 2050, Greenpeace points out that they are among the top carbon emitters in Bitcoin mining investments.
The report criticizes the Bitcoin industry for making misleading claims about its environmental impact and accuses miners of greenwashing by exaggerating the benefits of cryptocurrency mining on renewable energy transition and power grid stability. Greenpeace likens these tactics to strategies employed by the tobacco and fossil fuel industries to paint a false green image.
In response to the environmental concerns posed by Bitcoin mining, Greenpeace advocates for regulation, taxation, and a shift from proof-of-work (PoW) to proof-of-stake (PoS) consensus protocol to mitigate the industry’s energy consumption.
The report’s findings are likely to spark controversy within the cryptocurrency community, as Greenpeace’s assertions clash with the community’s perspectives on the sustainability of Bitcoin mining practices.