WEF 2022: Trust and clarity are missing in discussions of carbon emissions and crypto

Panelists at the World Economic Forum session on crypto’s carbon footprint seem to be seeing FUD galore surrounding the environmental consequences of crypto mining.

The need for a clear, balanced concept of the issue was a constant theme at the panel discussion of crypto’s carbon footprint at the 2022 World Economic Forum. There was general agreement that there has been a rush to judgment on the consensus mechanisms of crypto mining and education, and careful policymaking can counteract it.

“Crypto tribalism” on social media is an impediment to environmentally sound crypto mining, FTX.US president Brett Harrison said, comparing the situation to politics. “A vocal minority obscures the majority,” he said, while there is a unified effort in the background. He added, “Practitioners have to tell actual stories.” 

DataKind CEO Lauren Woodman spoke of the need to “get everyone to the table.” In some places, crypto mining operations are often seen as disruptive to the energy systems they depend on, she said, but an anchor energy client enables infrastructure construction in other places.

“Picking one winner” among the variety of consensus mechanisms “defeats the purpose of blockchain,” which is multichain, multi-asset interoperability, Denelle Dixon, CEO of the Stellar Development Foundation, said. There should be no value judgment on energy consumers, rather energy efficiency should be a value for all of them equally.

Skybridge Capital managing partner Anthony Scaramucci equated decentralization with antifragility and pointed out that crypto mining is in the early stages of its development, “so early that a winner can’t be picked.”

Harrison brought up the practical side of the question. “All of us on this platform can agree on the need for regulation, I think,” Harrison said, adding that responsible regulation is not banning technology, but solving problems.

Education has to accompany regulation, according to Robert Wardrop, management practice professor of finance at Cambridge University and director of the Cambridge Centre for Alternative Finance. He said:

“Trusting technology means trusting its governance.”