Canadian investment fund Ninepoint Partners LP has announced that they will dedicate a portion of its crypto ETF’s management fee to offset the fund’s carbon footprint.
The company’s managing director, Alex Tapscott, said the company was doing so to alleviate the apprehension some investors have about cryptocurrency’s energy usage. “For some investors who are concerned about the carbon footprint of mining, they may be wary of investing in a Bitcoin ETF,” Tapscott said. “What we’re doing is creating what we hope is a solution to that problem and giving them the choice that they want and, frankly, that they need.”
Bitcoin’s carbon footprint
Ninepoint has made this a priority in light of bitcoin (BTC) becoming notorious for the amount of energy mining it consumes. According to an analysis from Bank of America, the energy used to mine bitcoin is comparable to many developed countries.
Recently, Ripple co-founder Chris Larsen gave a more precise accounting. He said that “bitcoin alone [consumes] an average of 132 TWh a year (equivalent to roughly 12 million U.S. homes), and [releases] an estimated 63 million tons of CO2 annually.”
For its part, Ninepoint is partnering with environmental software fintech-firm CarbonX to buy carbon credits and support forest conservation projects. The firm is also collaborating with the Crypto Carbon Ratings Institute. As part of the partnership with CarbonX, they will provide carbon footprint analyses.
Crypto conservation efforts
Ninepoint is not alone in working to offset the impact of cryptocurrency mining. One River Asset Management is developing a system that calculates the carbon cost of mining. It then buys the corresponding amount of carbon credits to account for it. The company also said it would build carbon neutrality into its existing bitcoin and ether (ETH) funds. Additionally, it is planning to seek regulatory approval for an ETF with the same features.
In March, Argo Blockchain announced a partnership with DMG Blockchain Solutions to launch Terra Pool. This reportedly would be the first bitcoin mining pool to exclusively run on clean energy, predominantly hydroelectric resources.
“This is something that is, in my view, very important — it’s going to be with us for a long time — and so we need to figure out a way to ensure that bitcoin can scale and reach its potential in a sustainable way,” Tapscott concluded.
Disclaimer
In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content. Please note that our Terms and Conditions, Privacy Policy, and Disclaimers have been updated.
