Banks vs cryptocurrencies for CO2 emissions

Cryptocurrencies are talked about as big polluters of the environment, but banks are no different when it comes to CO2 emissions.

CO2 emissions of banks

Every year banks issue around 6.5 billion cards worldwide, churning out 136,500 tonnes of carbon dioxide (CO2) in the process: the equivalent of flying from New York to Sydney over 80,000 times. 

Based on these figures, Tenemos, a company specializing in providing software for banks and financial institutions, has issued a concerned cry of alarm.

According to the technology company’s experts, urgent action would require banks to make greater use of digital technology, starting with cloud computing.

According to recent research by Microsoft, companies using their cloud infrastructure, one of the most popular in the world, are 93% more energy-efficient and 98% less carbon-intensive than those using their own in-house data centres.

Kalliopi Chioti, Chief Environmental, Social and Governance Officer of Temenos said about this: 

“Banks need to act now. Their customers, investors and employees now expect it. By moving to the cloud they will see an immediate and significant reduction in their carbon footprint. COVID-19 Has Shown Cloud’s Ability To Benefit Society and the Environment”.

The need for the cloud also stems from the banks’ increased use of artificial intelligence and machine learning, which are taking up more and more space and increasing power consumption for corporate data centres.

Chioti added:

“As more workloads move to public cloud infrastructure, the need for banks to maintain their own private data centres diminishes. That means less hardware and floor space, less IT staff leaving behind their own carbon footprints, and less electricity to run it all”.

Carbon neutral cryptocurrencies

Cryptocurrencies, which have always been accused of being big energy users and therefore big polluters, have recently shown great sensitivity to environmental issues.

In recent days, one of the world’s largest cryptocurrency exchanges BitMEX has announced that it has achieved zero emissions status.

In April, 150 crypto companies, financial firms and non-profit organizations signed the Crypto Climate Accord to achieve complete carbon neutrality by 2030.

Among the proposed targets is the use of 100% of the energy used by the renewable sector. Many Bitcoin mining factories, one of the most energy-intensive activities, are already adopting renewable energies such as solar, hydroelectric, wind and nuclear power for their operations.

Sustainable Bitcoin mining

Recent estimates have calculated that the production of Bitcoin generates between 22 and 22.9 million tonnes of carbon dioxide emissions per year, some 13 times greater than that emitted by, for example, gold.

It is for these reasons that new forms of cryptocurrency mining are being explored, such as that of using waste natural gas proposed by some Russian oil companies in recent days.