Addressing sustainability in fintech and crypto is more important than ever. As cryptocurrency becomes increasingly mainstream — with more financial institutions, companies like PayPal, Visa and Tesla and individual investors racing to leverage this technology — energy consumption has accelerated to already unsustainable levels.
The industry has a choice to make: Will we continue down an unsustainable path or can we work together and reduce our collective environmental impact? Last year, we partnered with Energy Web (EW) and the Rocky Mountain Institute (RMI) to decarbonize public blockchains — starting with the XRP Ledger, the first major global blockchain to do so. As a company, Ripple also pledged to achieve carbon net zero by 2030 or sooner.
Today, we’re excited to announce the next step in Ripple’s sustainability journey: our commitment to the Crypto Climate Accord (CCA) — a new initiative organized by EW, RMI and the Alliance for Innovation Regulation (AIR) to make the cryptocurrency industry 100% renewable.
Ripple is joining over 20 supporters across different industries and blockchains, including the United Nations, CoinShares, Compass Mining, the XRP Ledger Foundation and ConsenSys to ensure that the crypto industry comes together to develop solutions that enhance sustainability, scalability and create value for all.
Ensuring a Sustainable Future, Together
The crypto market cap is nearly $2 trillion today — double the previous all time high, reached just three months ago — underscoring how quickly this industry is growing.
But this comes at a cost. Globally, the damages from climate change will amount to almost 3% of GDP by 2060. Herein lies the crux of the challenge moving forward: how can both the environment and global finance prosper without negatively impacting one another?
It starts with companies across the spectrum of finance coming together to address and prioritize emissions reduction and renewable energy use. In an industry known for innovation and rapid change, these should be solvable challenges. With the CCA, the crypto and blockchain community has taken a huge step in the right direction.
Inspired by the Paris Climate Accord, fintech and crypto industry leaders have partnered to launch the Crypto Climate Accord, a private sector-led initiative focused on decarbonizing cryptocurrencies to ensure the global financial system is less harmful and more sustainable.
Key objectives of the Accord include:
- Enable all of the world’s blockchains to be powered by 100% renewables by the 2025 UNFCCC COP Conference
- Develop an open-source accounting standard for measuring emissions from the cryptocurrency industry
- Achieve net-zero emissions for the entire crypto industry, including all business operations beyond blockchain and retroactive emissions by 2040
Ripple’s Journey To Carbon Neutrality
The Crypto Climate Accord recognizes that financial technologies – including blockchain and cryptocurrency – are well-positioned to lead global finance’s commitment to a sustainable future. Recent studies suggest that now through 2023 are the most critical years of adoption growth for crypto and we know it will be more difficult to “reverse engineer” a systemic characteristic like sustainability the longer we wait. The time to solve this problem is now.
Ripple is committed to leading this effort, and our strategic partnership with organizations like Rocky Mountain Institute, Energy Web and AIR, are a critical component in achieving sustainability. This will ensure that key industry stakeholders come together to contribute ideas, technical innovations, policy ideas and financing for innovations to help achieve the Accord’s long term objectives.
Across industries, the adoption of sustainable measures like these can save the global economy an estimated $26 trillion by 2030. As fintech becomes increasingly more prominent, the opportunity for the industry to lead global finance towards a carbon-neutral future becomes greater.
Together we can create a more robust and sustainable global financial system and a healthier, more sustainable world. For more information on Ripple’s commitment to sustainability, visit Ripple Impact.
