Does cryptocurrency need to go green?

Tom Rodenby

|

29

August 2022

01

June 2022

Does cryptocurrency need to go green?

Tom Rodenby

|

29

August 2022

01

June 2022

Cryptocurrencies have been generating headlines for years. But bubbling along in the background is an ongoing discussion about the environmental impact of the energy-intensive mining process.

We wanted to know what people think, so we distributed a survey to participants who use one or more cryptocurrency exchanges regularly. Prolific has free pre-screeners for 10 different cryptocurrency exchanges covering over 20,000 participants.

Our aim was to examine beliefs about the environmental impact of cryptocurrencies and to understand if people are willing to pay more to offset this impact.

Key figures:

  • 1000 participants took part in the survey
  • Participants were evenly split between male and female using our balanced sample feature
  • We collected this data in just 4 hours
  • 100% of our participants passed the attention check we included

Let’s get into the results!

The negative environmental impact of cryptocurrencies

Cryptocurrency has come under scrutiny in recent years due to the energy-intensive nature of its production, so-called ‘mining’. But do those who use cryptocurrency exchanges believe this is the case?

Graph displaying results to the question 'Do you believe cryptocurrencies have a significant negative environmental impact?'

The majority of our sample (77%) rated their belief in the negative environmental impact of cryptocurrencies as ‘somewhat’ or lower, with 21% indicating that they did not believe this was true at all.

But, the environmental impact of cryptocurrency is well-documented, prompting the question: are cryptocurrency customers lacking knowledge of the mining process, or are they denying responsibility because they are invested in the technology?

Limiting the negative environmental impact of cryptocurrencies

Although the results from the previous question indicated our sample didn’t believe cryptocurrencies have a negative environmental impact, we wanted to know if they would be willing to pay higher fees if it would guarantee a lower environmental impact.

Graph displaying answers to the question 'Would you be willing to pay higher fees to an exchange if they could guarantee a lower environmental impact?'

Interestingly, almost half of the sample indicated that they would be happy to increase the fees they pay on this basis. This was especially true in younger demographics, which might not come as a surprise given the common finding that younger people are more likely to be concerned about the environment.

Coupled with the prior results, this suggests that despite not being clear on whether there is a negative environmental impact of cryptocurrencies, roughly half of consumers would like to see exchanges do more to address any potential impact and would be willing to increase their spending to guarantee this.

Whether we’d see the same willingness to pay additional fees if they were actually introduced remains to be seen! Further testing would be helpful, for example, running a behavioural experiment to see what price increases people would be willing to pay depending on personal opportunity vs environmental implications.

This study was powered by Prolific’s cryptocurrency prescreener, which is just one of many prescreeners available to researchers. And if the prescreener you need doesn’t exist, you can create a custom sample to ensure you reach exactly the right participants for your study.

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