We introduce a novel framework for tracking greenhouse gas (GHG) emissions across a fuel supply chain. It facilitates the exchange of emissions inventory data between organizations to determine a products cumulative carbon footprint based on the Life Cycle Assessment (LCA) methodology. It offers a systematic approach to exchange data and overcome challenges in reporting indirect value chain, or scope 3, emissions. We highlight how the tracking system can impact reporting transparency, accuracy and reliability, while also addressing data privacy issues and commercial interests of participating organizations. The framework has been implemented within the Hyperledger Labs Blockchain Carbon Accounting Project using the ERC-1155 multi-token standard. A Net Emissions Token network is used by registered dealers to issue tokens for audited emissions data or carbon offset credits. These are aggregated into non-fungible tokens (NFTs) within the Carbon Tracker network. The NFTs represent unique emissions profiles that are linked to product quantities used to transfer inventory data between organizations. We present stylized examples based on emission performance certification in voluntary markets, cross-border trade, and for performance based financing.
Xiaoyang Shi, Hang Xiao, Weifeng Liu, Xi Chen · 7 authors
The distributed consensus mechanism is the backbone of the rapidly developing blockchain network. Blockchain platforms consume vast amounts of electricity based on the current consensus mechanism of Proof-of-Work (PoW). Here, we point out a different consensus mechanism named Proof-of-Stake (PoS) that can eliminate the extensive energy consumption of the current PoW-based blockchain. We comprehensively elucidate the current and projected energy consumption and carbon footprint of the PoW- and PoS-based Bitcoin and Ethereum blockchain platforms. The model of energy consumption of PoS-based Ethereum blockchain can lead the way toward the prediction of other PoS-based blockchain technologies in the future. With the widespread adoption of blockchain technology, if the current PoW mechanism continues to be employed, the carbon footprint of Bitcoin and Ethereum will push the global temperature above 1.5 °C in this century. However, a PoS-based blockchain can reduce the carbon footprint by 99% compared to the PoW mechanism. The small amount of carbon footprint from PoS-based blockchain could make blockchain an attractive technology in a carbon-constrained future. The study sheds light on the urgency of developing the PoS mechanism to solve the current sustainability problem of blockchain.
Amaç -Bu araştırmanın amacı, kripto para piyasasında en büyük kapitalizasyona ve en çok işlem hacmine sahip kripto para olan Bitcoin'in, volatilitesini en
This study examined how the relationships among the fossil fuel, clean energy stock, gold, and Bitcoin markets have changed since the COVID-19 pandemic took place for hedging the price change risks in the fossil fuel markets. We applied the Bayesian Dynamic Conditional Correlation-Multivariate GARCH (DCC-MGARCH) models using US daily data from 2 January 2019 to 26 February 2021. Our results suggest that the fossil fuel (WTI crude oil and natural gas) and financial markets (clean energy stock, gold, and Bitcoin) generally had negative relationships in 2019 before the pandemic prevailed, but they became positive for a while in mid-2020, alternating between positive (0.8) and negative values (−0.8). As it is known that negative relationships are required among assets to hedge the risk of price changes, this implies that stakeholders need to be cautious in hedging the risk across the fossil fuel and financial markets when a crisis like COVID-19 occurs. However, our study also revealed that such negative relationships only lasted for three to six months, suggesting that the effects of the pandemic were short term and that stakeholders in the fossil fuel markets could cross hedge with the financial markets in the long term.
Alain Aoun, Hussein Ibrahim, Mazen Ghandour, Adrian Ilinca
Global economic growth, demographic explosion, digitization, increased mobility, and greater demand for heating and cooling due to climate change in different world areas are the main drivers for the surge in energy demand. The increase in energy demand is the basis of economic challenges for power companies alongside several socio-economic problems in communities, such as energy poverty, defined as the insufficient coverage of energy needs, especially in the residential sector. Two main strategies are considered to meet this increased demand. The first strategy focuses on new sustainable and eco-friendly modes of power generation, such as renewable energy resources and distributed energy resources. The second strategy is demand-side oriented rather than the supply side. Demand-side management, demand response (DR), and energy efficiency (EE) programs fall under this category. On the other hand, the decentralization and digitization of the energy sector convoyed by the emersion of new technologies such as blockchain, Internet of Things (IoT), and Artificial Intelligence (AI), opened the door to new solutions for the energy demand dilemma. Among these technologies, blockchain has proved itself as a decentralized trading platform between untrusted peers without the involvement of a trusted third party. This newly introduced Peer-to-Peer (P2P) trading model can be used to create a new demand load control model. In this article, the concept of an energy cap and trade demand-side management (DSM) model is introduced and simulated. The introduced DSM model is based on the concept of capping consumers’ monthly energy consumption and rewarding consumers who do not exceed this cap with energy tradeable credits that can be traded using blockchain-based Peer-to-Peer (P2P) energy trading. A model based on 200 households is used to simulate the proposed DSM model and prove that this model can be beneficial to both energy companies and consumers.
Eighteen percent of the world’s population do not have access to electricity, impeding economic, social, and human development. The electricity access challenge can be attributed to the significant investment gap needed to finance new power projects, requiring new and innovative financing options. Independent Power Projects, funded, built, owned, and operated by the private sector and constituted via a special purpose vehicle—a legal entity whose sole purpose is implementing a power project—have become one of the fastest-growing sources of investment in the electricity sector. The limitations of traditional finance sources, including high credit, liquidity, margining, third-party, legal, and process risks, means that funds for these projects are expensive and raised only after a long and arduous process. The present article addresses these challenges by describing a novel decentralized autonomous organization, a blockchain-agnostic special purpose vehicle underpinned by a trio of autonomous mechanisms—mobilization, collateralization, andsettlement. These mechanisms enable seamless finance mobilization for the special purpose vehicle from a location-independent crowd, revenue collection from the electricity buyer in a risk-mitigated manner, and disbursal of eventual project revenues to investors.
The rationality and scientific nature of the emission trading mechanism is the key to the effective implementation of environmental and economic policies. As far as China is concerned, there are phenomena such as information asymmetry, low supervision efficiency, and alienation of government and enterprise behaviors caused by the incomplete mechanism of emission trading in the practice of different pilots. The introduction of blockchain technology can innovate the traditional transaction model and form a decentralized peer-to-peer transaction and a trusted emission trading market. To this end, based on the current emission trading mechanism and the characteristics of blockchain technology, this paper couples the core technologies of blockchain with the functional requirements of application scenarios. Then, an innovative application framework is built based on the consortium blockchain Fabric from three aspects: emission trading supervision, secondary trading market construction, as well as emission trading incentive and punishment mechanisms. Technologies such as the consensus mechanism, smart contract, Merkle tree and asymmetric encryption are comprehensively applied in this process. In the construction of the blockchain framework of the secondary market for emission trading, institutional changes and innovations brought about by the blockchain at various levels are analyzed in terms of participants, transaction processes and the transaction scope. At the same time, smart contract functions and algorithms are designed for the purchase, transfer-out and trading of emission rights, and the operation business logic of the smart contract is analyzed. On the whole, this paper explores the application framework of blockchain technology in the field of emission trading at the macro level, and analyzes the application mechanism of the corresponding technologies of blockchain at each coupling point in the framework at the micro level. The collaborative analysis at the two levels shows that blockchain technology and the requirements of emission trading mechanism can be effectively coupled, and the application of blockchain technology can promote the effective supervision of enterprises' emission behavior, making the processes of the purchase, transfer and transaction of emission rights intelligent and automated, and providing technical support for cross-regional emission trading to reduce transaction costs and management complexity. In addition, the issuance of emission credits based on smart contract will be a new incentive for companies to actively participate in transactions. Based on the above analysis, this paper believes that the innovative application of blockchain technology is of great significance in the promotion of the market-based allocation of element of emission trading and the rational allocation of environmental resources. It will lead to a major breakthrough in the traditional trading system in terms of trading modes, forming a value transmission network of environmental resources between the government and polluters.
Dong Wang, Jiaxing Xuan, Zhiyu Chen, Da Li · 5 authors
With the continuous advancement of the green certificate trading mechanism, information verification needs to span multiple departments, which causes the application process cumbersome and human errors. In order to solve problems of cumbersome issuance process of the renewable energy certificate (REC) and the inflexible pricing mechanism, in this paper, a hybrid REC trading system was proposed based on an permissioned blockchain technology (BT), which combined advantages of the BT and the continuous double auction (CDA). The operation process of the system was introduced in detail, and the view change protocol in the Practical Byzantine Fault Tolerance algorithm was revised according to the characteristics of the system to improve the system stability. The continuous double auction rule was also introduced in the system. And corresponding bidding strategies were designed to maximize the revenue of users (buyer and seller) and transaction probability. The simulation experiment proves that the bidding mechanism can flexibly adjust the REC price according to the supply and demand relationship. At the same time, the effectiveness and feasibility of trading rule and bidding strategy were also verified.
As an important way to reduce emission, forestry carbon sink (FCS) has not been implemented effectively. Therefore, this paper aims to analyze the effectiveness and mechanism of applying blockchain technology in FCS projects by utilizing the differential game model. A Stackelberg differential game model between forest farmers and emission-controlled enterprises (ECEs) is developed to analyze the optimal emission reduction efforts and the optimal trajectory of forest farmers and ECEs before and after introducing blockchain technology. It is found that: (1) At the initial stage of the utilization of blockchain technology, if blockchain technology takes a leading role in stabilizing carbon prices, the ECEs prefer to purchase FCS instead of reducing emissions by their own technology. On the contrary, if blockchain technology takes a leading role in stimulating the vitality of the carbon trading market, ECEs tend to use emission abatement technology to meet the carbon quote requirements. (2) In the later stage, the incentive and stabilizing effects of blockchain technology on carbon prices tend to be balanced, and the emission reduction efforts of ECEs are lower than the efforts before applying blockchain technology. (3) The application of blockchain technology increases forest farmers’ willingness to reduce emissions because of its effection of cost reduction and efficiency improvement. Meanwhile, blockchain technology reduces abatement costs by influencing carbon prices. Therefore, blockchain technology improves forest farmers’ emission reduction efforts on the whole.
Abstract We study the economic determinants of transaction fees in the Ethereum blockchain. We estimate an empirical model based on queueing theory and analyze the factors determining the “gas price” (transaction cost per unit of service, “gas”). Using block‐ and transaction‐level data from the Ethereum blockchain, we show that changes in service demand significantly affect the gas price—when there is high block utilization, per‐unit fees increase on average, with strong nonlinear effect above 90% utilization. The transaction type is another important factor—larger fraction of regular transactions (direct transfers between users) is associated with higher gas price.
Khreshna Syuhada, Djoko Suprijanto, Arief Rachman Hakim
This paper aims to compare the safe-haven roles of gold and Bitcoin for energy commodities, including oils and petroleum, during COVID-19. Specifically, we examine the presence of reduction in downside risk after mixing gold/Bitcoin with such energy commodities. To do this, we account for dependence among energy commodities and gold/Bitcoin returns by applying a (vine) copula. The findings show that gold substantially reduces the downside risk of a portfolio containing any allocation to gold and energy commodities, indicating its safe-haven ability. In contrast, Bitcoin's safe-haven functionality is inconsistent since the downside risk reduction is achieved for Bitcoin's small allocation only.
The high power consumption of Bitcoin transactions has raised environmental and sustainable concerns of green investors and regulatory bodies. We utilize the time-varying optimal copula (TVOC) approach to showcase the dependence structure between bitcoin and green financial assets. We find multiple tail-dependence regimes characterize the extreme dependence between bitcoin and green financial assets, and the dependence structure is mainly asymmetric and time-varying. Finally, the hedging effectiveness of green financial assets for bitcoin revealed that all green assets, especially clean energy, are effective hedges for bitcoin.
Purpose The purpose of this paper is to extend the literature on the spillovers across economic policy uncertainty (EPU) and cryptocurrency uncertainty indices. Design/methodology/approach This paper uses cross-country economic policy uncertainty indices and the novel data measuring the cryptocurrency price uncertainties over the period 2013–2021 to construct a sample of 946 observations and applies the time-varying parameter vector autoregression (TVP-VAR) model to do an empirical study. Findings The findings suggest that there are cross-country spillovers of economic policy uncertainty. In addition, the total uncertainty spillover between economic policies and cryptocurrency peaked in 2015 before gradually decreasing in the following periods. Concomitantly, the cryptocurrency uncertainty has acted as the “receiver.” More importantly, the authors found the predictive power of economic policy uncertainty to predict the cryptocurrency uncertainty index. This paper’s results hold robust when using alternative measurement of cryptocurrency policy uncertainty. Originality/value This study is the first research that deeply investigates the association between two uncertainty indicators, namely economic policy uncertainty and the cryptocurrency uncertainty index. We provide fresh evidence about the dynamic connectedness between country-level economic policy uncertainty and the cryptocurrency index. Our work contributes a new channel driving the variants of uncertainties in the cryptocurrency market.
Christopher S. Henry, Kim P. Huynh, Gradon Nicholls, Mitchell Nicholson
The Bank of Canada continues to use the Bitcoin Omnibus Survey (BTCOS) to monitor trends in Canadians’ awareness, ownership and use of Bitcoin. The most recent iteration was conducted in late 2018, following an 85 percent decline in the price of Bitcoin throughout the year.
Sanaz Chamanara, S. Arman Ghaffarizadeh, Kaveh Madani
The cryptocurrency sector is increasingly integrated into the global financial system. The world’s transition to a digital economy, facilitated by major technological breakthroughs, has several benefits. But as the demand for exchanging and investing in digital currencies is growing , the world must pay careful attention to the hidden and overlooked environmental impacts of this growth. The dramatic increase in the price of Bitcoin (BTC) over the last year and the resulting global race for BTC mining is turning the cryptocurrency market turning into one of the world’s leading polluting sectors. Yet, our knowledge about the environmental footprints of mining BTC is very limited. To address this hap, this study provides the first estimates of the carbon, water and land footprints of BTC mining around the world.
This study uses hourly data to analyse the return and volatility transmission of oil-gold and oil-Bitcoin pairs during the pre-COVID-19 and COVID-19 periods. The results show that the return transmissions vary across the two periods for both pairs. There is a unidirectional volatility spill-over from gold to oil in the pre-COVID-19 period, and from oil to gold during the COVID-19 period. There is a significant volatility spill-over from Bitcoin to oil during the pre-COVID-19 period, whereas no evidence of volatility spill-over between oil and Bitcoin is shown during the COVID-19 period. Based on optimal weights, investors should increase their investments in, (a) gold for a portfolio of oil-gold, and (b) Bitcoin for a portfolio of oil-Bitcoin during the COVID-19 period. All hedge ratios are higher during the COVID-19 period, implying a higher hedging cost compared to the pre-COVID-19 period. The results of hedging effectiveness reveal that the risk-adjusted returns can be improved by constructing a portfolio of oil-gold and oil-Bitcoin during both sample periods. Further results reveal that gold is a strong safe haven and a hedge for the oil market, while Bitcoin serves as a diversifier for the oil market during the COVID-19 period.
Cryptocurrency symbolizes of a new development in the financial sector since it is the world's first entirely decentralized digital payment system. The cryptocurrency known as virtual money is one of the most important innovations brought on by digitalization. The purpose of this study is to analyze the relationship between the cryptocurrency (Bitcoin, Monero, and Stellar) with macroeconomics variables known as stock price index (Dow Jones dan Nikkei), oil price (Brent Oil dan WTI), and exchange rates (Australian Dollar, Euro, and Pound Sterling). The data was obtained from investing.com on monthly basis for the period between January 2016 untuil December 2020. The analysis were conducted based on unit root test, co-integration and vector error correction model (VECM) in order to identify the relationship between the three selected cryptocurrencis with macroeconomic variables. The findings of this paper showed that there is cointegration between the variables. The Vector Error Correction Model (VECM) indicates that the Bitcoin model and Stellar model did not have a long-run relationship. While for the second model, Monero found to have a long-run relationship with the variables. This research contributes to the growing study on cryptocurrency while extend and complement the literature by sourcing the latest research paper on this related field.
Marco Galici, Mario Mureddu, Emilio Ghiani, Gianni Celli · 7 authors
This paper suggests an application of blockchain as an energy open data ledger, designed to save and track data regarding the energy footprint of public buildings and public energy communities. The developed platform permits writing energy production and consumption of public buildings using blockchain-enabled smart meters. Once authenticated on the blockchain, this data can be made available to the public domain for techno-economic analyses for either research studies and internal or third parties audits, increasing, in this way, the perceived transparency of the public institutions. A further feature of the platform, starting on the previously disclosed raw data, allows calculating, validating, and sharing sustainability indicators of public buildings and facilities, allowing the tracking of their improvements in sustainability goals. The paper also provides the preliminary results of a field-test experimentation of the proposed platform on a group of public buildings, highlighting the possible benefits of its widespread exploitation.
Khaled Mokni, Elie Bouri, Ahdi Noomen Ajmi, Xuan Vinh Vo
This paper examines the hedge and safe-haven abilities of Bitcoin against U.S. aggregate and categorical economic policy uncertainty (EPU) via the application of quantile regression model augmented with a dummy and some control variables. Using monthly data from September 2011 to December 2019, empirical results indicate that Bitcoin does not act as a strong hedge against the aggregate U.S. EPU. However, it acts as a strong safe-haven for this aggregate measure of uncertainty when the Bitcoin market is bearish. Looking deeper into the disaggregated level of the U.S. EPU data, the analyses involving categorical EPU data indicate the ability of Bitcoin to act as a strong hedge and safe-haven against specific uncertainties related to fiscal policy, taxes, national security, and trade policy.
Bitcoin, 2009 yılında ortaya çıkmasıyla devrim niteliğinde bir altyapı sunan kripto para türüdür. Bitcoinin temel teknolojisi olan blokzincir, güvenilir bir üçüncü tarafa ihtiyaç duymayan, merkezi olmayan bir sistem olarak tasarlanmış; geniş uygulama potansiyeli ile kamu ve iş dünyasında hızla kabul görmüştür. Bu çalışmada, Ocak 2012 – Mart 2020 tarihleri arasında cumhuriyet altını, altın ons fiyatı, ham petrol fiyatı, amerikan doları ve euro para birimleri ile bitcoin arasındaki korelasyon ilişkisi incelenmiştir. Araştırma kapsamında Spearman korelasyon analizinden faydalanılmıştır. Analizlerin sonucuna göre, piyasalara girdiği ilk dönem olan 2012’de bitcoinin diğer göstergelerle arasında istatistiksel olarak anlamlı bir ilişkisi saptanmamıştır (p>0.05). Bitcoinin dolar karşılığının bir önceki yıla göre üç katından fazla arttığı 2017 yılı ise bitcoinin zirve yılı olup; euro ile arasında pozitif yönlü kuvvetli bir ilişki vardır (r=0.873; p