The Rise of Sustainable Crypto
It was only a matter of time before something as forward-thinking as cryptocurrency would become the focus of entrepreneurs and traders wishing to capitalize on the enormous green agenda that is currently in the forefront of every influential mind from G7 government officials to social media influencers.
Even the banks and traditional fund management companies that have been in existence for decades have begun to major on what they call Environmental, Social and Governance (ESG) oriented product ranges, realizing that they will have to appeal to an audience which prioritizes environmental issues as well as demonstrate to governments that they are not pinstripe suited dinosaurs who only care about cold hard profit, and that they care about cold hard profit and the carbon footprint.
Elon Musk, an entrepreneur and scientist whose engineering projects are well known to catch the mood of the moment, used his perceived environmentally friendly edge in the car manufacturing business over his company’s rivals to infer that by Tesla, a company that makes cars that do not use any fossil fuels at all, not accepting Bitcoin for payment due to the vast amount of power resources required for Bitcoin mining, and therefore turned an entire market on its head.
Whether he really cares about any environmental impact, or was simply trying to ramp the price of his favored Dogecoin by dropping a media-hyped bombshell on Bitcoin is a subject for discussion.
Dogecoin is perceived to be more environmentally friendly than Bitcoin, and Mr Musk is now working with its developers as he considers that there are still several ways that his expertise could contribute to eliminating the digital currency’s carbon footprint, including focusing on renewable energy sources for dogecoin mining processes, as well as further streamlining the calculations required to mine the currency.
Whilst this fits in with the now infamous tweet that crashed the prices of 5 popular currencies, and chimes well with the current discussions that have been taking place at this year’s G7 leaders summit over in England in which seven leaders of developed economies that have a massive influence on the world’s business and financial ecosystem talked incessantly about climate change and roped in a series of blue chip executives who made the right noises by saying that they are committed to combatting climate change.
It is therefore inevitable that laws will likely come into place that concentrate on reforming the way that people live their lives and how energy consumption is regulated. Therefore, Mr Musk, whose electric cars are the darling of the coffee shop frequenting social media generation, is capitalizing on the imagery in the same way that Richard Branson did in the 1980s by positioning himself as a caring, sharing man of nature, whilst making sure he is in charge of an entire market.
Clearly, there will be an emphasis on green credentials in future, and Bitcoin miners have stated that they are committed to reducing the energy reliance in mining, an act which, once tweeted by… yes, you guessed it, Elon Musk…. Bitcoin values rose again.
Therefore, talking about the environmental impact of pretty much any product or service these days has an impact. Elon Musk tried this out and proved it to be something the entire world, regardless of their interest in financial markets or their political persuasion, is frightened of challenging.
The banks and traditional capital markets perhaps feel that they must follow the narrative in case they are branded outmoded, and the modern economy is all in for ecologically sound innovation, therefore whichever camp anyone is in, it is a very clear part of the future of all industry.
Some new cryptocurrency developments have therefore evolved and Dogecoin may find itself with some rivals which have a green credential-based ideology and there are some on the market already which are rising in value.
Dogecoin may have started life as a meme; its amusing dog logo and equally derisory ‘Comic Sans’ text being testimony to its computer science professional inventors’ humorous mocking of trends that suddenly gain weight and result in faddish fluctuations in popularity, but its technological topography is right up to date and is very much part of the new economic way of thinking which favors environmentalism, or at least perceived environmentalism over clinical profit.
Currently, meme cryptocurrencies represent a relatively undeveloped market, and many of the new entries are still either in testing phase or are not widely available, yet Dogecoin is down 2% today, hence investors are beginning to talk about what its rivals are doing at this time during which government leaders as well as influencers are talking about sustainable energy and what they consider to be a ‘climate crisis’.
If Dogecoin’s ecological advantage over non-meme currencies has any weight, it was accidental, as its co-creator Billy Markus admitted last month.
In May, he admitted that he did not consider any form of environmental impact created by, or counteracted by his invention. He realized its importance, however, when Elon Musk sent that famous tweet and followed his clever position up with a statement saying “To be clear, I strongly believe in crypto, but it can’t drive a massive increase in fossil fuel use, especially coal.”
In response, Mr Markus sent a crying face emoji, which he later clarified he had meant to indicate “aw man, you right, environment stuff”.
Following that response, and with Dogecoin’s perceived advantage in its lower energy use than Bitcoin, Mr Markus was asked if it was a deliberatly designed feature of Dogecoin, to which he replied “I made Doge in like 2 hours I didn’t consider anything” he wrote.
Given the limelight that Dogecoin now basks in, it is surprising that the value is down, however the meme sector is now facing an onslaught of challengers which are likely to rival Dogecoin.
Who knows whether this will become the norm, or whether it is a fashionable period in politics, or whether it is the Reddit board and Mr Musk’s future tool of choice when influencing the markets.