Crypto derivatives trading platform BitMEX, which has had its fair share of bad press over the past year, is trying to contribute to cleaning up the wider industry’s image by taking action to address growing climate concerns over the carbon footprint of Proof-of-Work currencies like Bitcoin (BTC).
In an announcement published on May 21, the exchange said that while there are ostensibly “wildly divergent views and accuracy of information” regarding the climate risks posed by some cryptocurrencies, BitMEX feels it has a “responsibility to take positive action.”
This action will take the form of an attempt to offset its carbon footprint by donating $0.0026 for every $1 of blockchain fees its users pay out. Exactly which organization will be the recipient of these donations is yet to be confirmed. BitMEX says it is currently researching whom to partner with and will release further details in due course. The exchange concedes:
“Carbon offsetting is not the only answer to concerns relating to the environmental footprint of crypto, but it’s certainly a good start […] the industry has to come together and tackle challenges that risk sidetracking our positive intentions.”
BitMEX has taken its $0.0026 figure from rough calculations published by Sam Bankman-Fried, the CEO of crypto derivatives exchange FTX and Alameda Research. Bankman-Fried’s suggestion, admitting “large error bars,” is that this sum should be enough for crypto firms to offset their carbon emissions.
A more robust response from the industry may be needed, as BitMEX seems to recognize. This month, the European Central Bank’s recent Financial Stability Review highlighted the “exorbitant carbon footprint” of crypto-assets as grounds for concern. Meanwhile, organizations ranging from Greenpeace to Tesla have begun ceasing to accept BTC payments due to the energy-intensity of mining and transactions.