KPMG’s endorsement brings clarity to the innovative technology and asset class, emphasizing the multitude of impactful use cases that Bitcoin offers, cementing its reputation as a transformative force in the financial ecosystem.
KPMG Champions Bitcoin’s Impact
KPMG International Limited, a major player among the Big Four accounting organizations, has thrown its weight behind Bitcoin’s sustainability, shedding light on its potential and dispelling misconceptions in a recent report titled “Bitcoin’s role in the ESG imperative.”
Despite a turbulent 2022, Bitcoin continues to command attention and emerge as the best-performing asset in 2023. However, despite its growing adoption, misconceptions persist about this innovative technology and asset class. Nonetheless, KPMG highlights the numerous impactful use cases that Bitcoin offers, bolstering its reputation as an ecosystem with transformative possibilities.
“There’s a variety of impactful use cases that Bitcoin offers that have a track record of delivering value for their users and society at large,” KPMG stated in the report. “These scenarios not only can improve the reputation of the overall ecosystem but pave the way for greater use and adoption.”
Bitcoin and Energy Usage
Amidst concerns about Bitcoin’s energy consumption, KPMG clarifies that Bitcoin itself doesn’t directly emit emissions, similar to electric vehicles.
The hardware employed in mining (ASICs) relies on electricity. While some Bitcoin mining operations produce emissions, the real issue lies in the emissions tied to energy production, particularly from burning fossil fuels.
Four Strategies to Reduce Carbon Footprint
KPMG suggested four strategies and ways to promote sustainable Bitcoin production. A few organizations are already working on them.
Use of Renewable Energy: Bitcoin miners can establish operations near renewable energy sources, creating a flexible load that aligns with supply and demand patterns. This dynamic power consumption can drive the expansion of renewable energy capacity and help balance electrical grids.
Demand Response Programs: Bitcoin miners can serve as a flexible load by participating in demand response programs. By curtailing power usage when demand is low and returning power to the grid during high demand, miners contribute to grid stability.
Recycled Heat: Innovative Bitcoin miners recycle the significant heat generated by mining rigs for heating purposes in homes, commercial buildings, greenhouses, and even swimming pools. Leveraging existing heat sources and heat exchangers maximizes energy efficiency.
Methane Reduction: Investments by Bitcoin mining operations, such as espana Energy, enable the capture and conversion of fugitive methane emissions into useful electricity, reducing environmental impact.
“Bitcoin miners are identifying new and creative ways to source their power which has also resulted in the reduction of methane that enters the atmosphere,” KPMG stated.
Addressing Illicit Activities and Financial Inclusion
KPMG acknowledges concerns about Bitcoin’s association with illicit activities but provides context. While crypto, including Bitcoin, accounts for a mere 0.24% of total illicit activity, up to 5% of global GDP is used for money laundering. According to the firm, Bitcoin’s transparent and immutable blockchain can play a vital role in combating illicit financial activities, making it a valuable tool in the fight against crime.
Further, KPMG highlights Bitcoin’s potential for inclusion and positive impact in various scenarios. From facilitating cross-border payments through money transmitters to supporting countries during crises like Ukraine’s war with Russia, Bitcoin demonstrates its ability to empower regions lacking access to electricity.
Furthermore, Bitcoin fosters financial inclusion by enabling citizens to escape authoritarian and corrupt regimes where traditional financial systems are restricted.
KPMG emphasizes that Bitcoin’s most salient attributes lie in its decentralization and robust security. Providing these features empowers individuals and societies, contributing to the creation of a more inclusive and sustainable financial landscape.
Bitcoin ($BTC) is trading at $29,475.27, up 2% in 24 hours.
