Bitcoin and its negative impact on the environment have been a topic of discussion ever since the largest digital asset started experiencing considerable price gains. However, the long speech on the damaging effects of bitcoin and the crypto market never stopped there: “Bitcoin is a threat to financial stability” or “Cryptocurrencies impose serious risks on customers” have been around almost as long as the first argument.
When it comes to cryptocurrencies and their impacts on different aspects of our lives, many are quick to wave away the positive effects and focus on the negative, and that only. It’s no secret that Bitcoin has a high power consumption, but there’s much more to it than just that.
“Environmental” Is Not the Only Element in ESG
As the world grows in number, we can see that investors are more concerned about the Environmental, Social, and Governance (ESG) impacts of their investments. And it goes without saying that Bitcoin is falling quite short on the environmental side.
Yet, even though most of the crypto projects are not consuming massive electricity as they are not performing on a proof-of-work (PoW) mechanism, the market as a whole is mainly assessed by Bitcoin and its performance.
Bitcoin’s transition to a greener alternative seems unlikely for the time being, however, miners are utilizing more sustainable energy sources to reduce the environmental impact of bitcoin as much as possible.
Regardless of these initiatives though, we can raise the counterargument that crypto’s energy consumption is for serving people on this planet as the technology is bringing us limitless, borderless, and decentralized banking alternatives that are open and accessible to all.
Crypto for Charity
Through their anonymity, cryptocurrencies allow for anonymous and easy donations. To make things more reliable, philanthropy organizations can leverage blockchain technology to record all the information related to donations to give contributors the ability to trace their funds and how and for what deeds they have been used.
The UNICEF CryptoFund is a very good example of how major organizations around the globe are benefiting from crypto assets and using them to further their positive impact on the social lives of many people dependent on their support.
The fund includes bitcoin and ether and the public records of transactions are published by UNICEF to add an extra layer of transparency to the whole process. According to UNICEF, the fund allows the organization to benefit from the transparent nature of blockchain technology and its low transaction costs.
Crypto for Troubled Economies
All fiat currencies are inflationary, however, some of them are losing their value way faster than others. In troubled economies with weak national currencies, people are always looking for ways to hedge their funds against inflation by moving them into safer markets.
Bitcoin, alongside gold, has become one of the favorable options for many investors in such environments. Stablecoins of major fiat currencies, like the US Dollar, are another type of cryptocurrency that have also gained popularity in this regard.
Crypto for Moving Funds
Many countries have imposed restrictions on the amount of funds that investors can move out of the borders in an attempt to maintain the value of their national currencies. As financial freedom proponents, we seek true ownership of our money which means moving them whenever and wherever we want.
This is one of the interesting occasions where cryptocurrency-based cross-border transfers can come to the rescue. While in cryptocurrency form, investors hold complete power over their funds through their private keys and would not face any issues transferring their assets at their desired time.
Crypto for Remittance
Bitcoin is leading an industry that can finally bring us one step closer to financial inclusion and freedom, shaping a brighter and more inclusive future for the 1.7 billion unbanked people across the world.
In today’s world, many of us prefer to explore the globe through our occupations, not limiting ourselves to one nation or state. This highlights the need for a fast, secure, and convenient remittance solution more than ever as we need to send and receive funds while living as expats. Cryptocurrencies proved to be quite helpful in this regard as they met all the criteria we need.
The Social Impact of Crypto Is Not A Hype Anymore
The crypto market is quite new; the space has brought many positive changes to different industries and we have a future ahead of us to mature and learn. One thing is clear: we cannot gauge the whole ecosystem based on a bad business model or improper management as a bankrupt company doesn’t indicate that the whole stock market is dead.
Now, considering all the elements, can’t we simply say that the positive social impact of crypto is a counter force that offsets if not outweighs, some negative past incidents of the crypto assets?