From Environmental Concerns to Market Moves: How Environmental Awareness Shapes Cryptocurrency Returns?

Abstract

Environmental concerns may influence cryptocurrency prices. Investors' information acquisition regarding environmental issues linked to cryptocurrency mining plays an important role in the pricing of cryptocurrencies. The volume of Google searches for environmental issues related to cryptocurrency mining significantly and negatively affects future cryptocurrency returns. This impact is more pronounced for Proof-of-Work (PoW) cryptocurrencies, which are known for their high energy consumption, compared to Proof-of-Stake (PoS) cryptocurrencies. This study provides important insights into how environmental awareness influences cryptocurrency markets, offering a novel perspective on market prices in the context of sustainability.