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Category Archives: ESG, Financial Inclusion, Sustainable Finance

Canadian securities regulators publish guidance on ESG-related investment fund disclosure

CSA Release | Jan 19, 2022

ESG fund disclosure guidance - Canadian securities regulators publish guidance on ESG-related investment fund disclosureToronto – The Canadian Securities Administrators (CSA) today published guidance for investment funds on their disclosure practices that relate to environmental, social and governance (ESG) considerations, particularly funds whose investment objectives reference ESG factors and other funds that use ESG strategies (ESG-Related Funds).

The guidance is based on existing regulatory requirements and addresses areas of disclosure, including investment objectives, fund names, investment strategies, risk disclosure, continuous disclosure and sales communications.

See:  New SEC task force will scrutinize ESG and climate disclosures and marketing

As the investment fund industry creates new funds and incorporates ESG considerations into existing funds to meet demand, there is an increased potential for “greenwashing” – where a fund’s disclosure or marketing intentionally or inadvertently misleads investors about the ESG-related aspects of the fund.

“Interest in ESG investing is on the rise and this enhanced and practical guidance will play an important role in helping investors make informed decisions about ESG products, as well as preventing potential greenwashing,” said Louis Morisset, CSA Chair and President and CEO of the Autorité des marchés financiers.

This guidance is intended to help investment funds and their fund managers enhance the ESG-related aspects of the funds’ regulatory disclosure documents and ensure that sales communications of ESG-Related Funds are not untrue or misleading and are consistent with the funds’ regulatory offering documents.

The guidance follows the CSA Roundtable on ESG-Related Regulatory Issues in Asset Management, which was held on September 27, 2021.

See: 

As part of its ongoing continuous disclosure review program, the CSA will continue to monitor the ESG-related disclosure of funds.

The CSA, the council of the securities regulators of Canada’s provinces and territories, co-ordinates and harmonizes regulation for the Canadian capital markets.

Download the 27 page PDF guidance report --> here


NCFA Jan 2018 resize - Canadian securities regulators publish guidance on ESG-related investment fund disclosure The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

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US government to address the ramifications of cryptocurrencies on Jan 20th -> Tune in here

FinBold | Jordan Major  | Jan 16, 2022

US government - US government to address the ramifications of cryptocurrencies on Jan 20th -> Tune in hereThe Bitcoin mining sector has piqued the interest of several countries over the last year, and it appears that the United States government is starting to become interested in this market.

As a result, a hearing has been scheduled in the US to explore the ramifications of the energy consumption incurred by cryptocurrency mining operations. Indeed the Subcommittee on Oversight and Investigations of the Committee on Energy and Commerce will conduct a public hearing on the subject next Thursday, January 20, according to the House Committee.

“The Subcommittee on Oversight and Investigations of the Committee on Energy and Commerce will hold a hybrid hearing that includes both in-person and remote attendance on Thursday, January 20, 2022, at 10:30 a.m.”

See:  Landmark Jury Verdict Finds Digital-Asset Products Linked to Cryptocurrency Mining Are Not Securities

The investigation is titled “Clearing Cryptocurrency: The Energy Implications of Blockchains,” and in particular, the Subcommittee is interested in learning about the energy consumption of blockchains, with the premise that they may create environmental concerns in the future. On the scheduled day, the hybrid hearing will also live stream on YouTube.

Congress’ energy subcommittee to discuss cryptocurrency

Bitcoin has gone through a lot of ups and downs in its short existence of just 13 years; however, one of the most recent efforts to discredit this technology is predicated on the fact that it is energy-intensive.

Proponents of Bitcoin argue those who oppose digital currency have not considered the costs of technology compared to the conventional banking system or the energy required to transport paper money across the globe.

US crypto mining growth

In response to the rapid expansion of US mining businesses after China’s mining prohibition, the local mining industry organized the formation of a Mining Council in 2021, which is overseen by the likes of Michael Saylor and Elon Musk.

See:  Arcane Research: Summary of Crypto 2021

Watch the live stream on January 20th: Cleaning Up Cryptocurrency: The Energy Impacts of Blockchains

Continue to the full article --> here


NCFA Jan 2018 resize - US government to address the ramifications of cryptocurrencies on Jan 20th -> Tune in here The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

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Alternative forms of capital will be key to develop sustainable economic systems

Fintech Confidential Issue 4 | Éliane Ubalijoro, PhD | Jan 13, 2022

liane Ubalijoro alternative forms of capitalare key to sustainability - Alternative forms of capital will be key to develop sustainable economic systems

A year and a half into the COVID-19 pandemic, the global economy is looking cautiously at recovery. According to the World Bank, growth will be very uneven given surges of virus variants, patchy vaccination rates, and withdrawal of government support measures, so global GDP in 2021 is still expected to be 3.2% below pre-pandemic projections. To support a more equitable and sustainable recovery, it is imperative that our economic systems recognize how they need to be underpinned by "flourishing communities, strong and resilient social institutions, thriving natural ecosystems and a stable climate” as the Capitals Coalition  articulates. As a member of their supervisory board, I truly believe that we must empower organizations to understand that their success and the success of the global economy more broadly is fundamentally dependent on natural, social, and human capital, in addition to produced capital.

We must work to curb greenhouse gas emissions in all the ways we produce goods and services, whether it is how we impact, air quality, energy management, water quality, how we reduce waste streams and maximize circular economies to minimize our ecological footprint. We must ask ourselves how are we valuing the rights of all people and nature, how are balancing our need for privacy and need for security, how are we making sustainable goods and services accessible, affordable and producible by all, not just some. It is time to consider product passports that standardize the ability to assess carbon footprint through a products lifecycle to help customers make buying choices that support planetary health. It is also important to ensure labor practices that favor employee health, safety, inclusion, diversity and equity.

It is time to enable that our businesses, financial institutions and governments include the value of all forms of capital in their decision-making, especially as countries face their commitments to the Paris Climate Agreement and United Nations 2030 Sustainable Development Goals.

And this is where there is huge potential to leverage digital technologies and increasingly, financial technology (fintech) to support a capitals accounting approach and to develop stronger ESG (environmental, social, governance) metrics in support of more sustainable investments.

For example, AgriLedger’s work in Haiti is very inspiring. This agricultural-focused blockchain systems provider is piloting a project to use blockchain technology for traceability and payment that will allow the farmer to maintain ownership until the sale at final destination, while all the packing and logistics services will be provided by AgriLedger. This mechanism scaled globally would give more power and improved livelihoods to farmers while minimizing waste streams as produce lifecycle management ensures maximum contribution to value chains as well as composting waste to increase soil health. CarbonX, a Canadian fintech-designed environmental software, enables users to calculate the carbon impact of their products and services and to offset this through investments in carbon mitigation projects carefully evaluated not only for their environmental impact but also for their social and economic impacts. Open Climate is a collaborative project led by the Open Earth Foundation, an non-profit organization operating globally and based in the United States. The project explores the potential application of a range of digital technologies to developing a transparent, global, integrated climate accounting system and aims to co-develop a decentralized ‘ledger of ledgers’ to collect and share climate data from around the world, balancing transparency and privacy.

Even with all these excellent examples, it is critical that the tools and technology are not developed in a black box. In order to have mechanisms such as stronger ESG metrics that can potentially transform investments and truly increase accountability, it is critical to first build trust. Trust in the metrics and trust in the technologies underlying the development of those metrics. By creating more inclusive, collaborative approaches to probe the assumptions underlying the algorithms used to develop ESG metrics, trust and common standards can be agreed upon.

Another barrier to overcome is the complexity of the systems at play

There is a dichotomy between technological literacy and education to build technological capacity on the one hand, and over-complexification of digital systems on the other hand. More of an effort must be made in order to de-complexify technology to some extent. This will avoid the development of what colleagues have referred to as “technological expertocracy” – or the continued development of a group of elites who have access to and understanding of the incredibly complex systems underlying the digital infrastructure that increasingly dictates our lives and is shaping fintech. A lack of trust in digital technologies or in the experts who develop and control them can create huge barriers to implementation, scaling, enabling policy frameworks and impact in terms of addressing systemic challenges such as climate change.

Related to this, there is a strong need to develop more human-centric technologies – including fintech. Engaging citizens more directly could be a positive way forward here, both to build trust and also to ensure that technologies are addressing biases, reflecting shared values, allowing more equity in access and incentivizing collaboration as opposed to increasing division.

And efforts are being made. For example, our initiative, Sustainability in the Digital Age, convenes leaders in business, government, science, and civil society to explore how to consciously steer the societal transformations unfolding from the development and deployment of new digital technologies, towards equitable and sustainable paths. Similarly, the Global Commons Alliance has been inviting all stakeholders interested in accounting and standard setting that considers ESG, to come together and work at shaping a co-creative space to align everyone. The international Coalition for Digital Environmental Sustainability (CODES) is an open multi-stakeholder community of change makers and practitioners that seek to collaborate in accelerating a digital planet for sustainability.

So the momentum is here, and collaboration is critical to unleashing the transformative power of digital technologies in an inclusive approach that values not just profit making but also our collective contributions to natural, social and human capital for planetary health.

liane Ubalijoro PhD - Alternative forms of capital will be key to develop sustainable economic systemsAuthored by: 

By Éliane Ubalijoro, PhD (LinkedIn)

Sustainability in the Digital Age, Executive Director

Future Earth, Global Hub Director (Canada)


NCFA Fintech Confidential Issue 4 250 - Alternative forms of capital will be key to develop sustainable economic systems

This article is featured in NCFA's digital magazine, Fintech Confidential (Issue 4). Click to read the latest thought leadership, insights and trends about Fintech in Canada:

Checkout NCFA's digital magazine, Fintech Confidential (Issue 4) --> here

 

 


NCFA Jan 2018 resize - Alternative forms of capital will be key to develop sustainable economic systems The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

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Gensler’s Updated Regulatory Agenda Critized by SEC Commissioners Peirce and Roisman (Exempt Securities)

Crowdfund Insider | | Dec 13, 2021

Gensler - Gensler's Updated Regulatory Agenda Critized by SEC Commissioners Peirce and Roisman (Exempt Securities)SEC Commissioners Hester Peirce and Elad Roisman have once again voiced their concern regarding SEC Chairman Gary Gensler’s regulator agenda – a list that was recently updated.

Last summer, Gensler published his regulatory agenda and now an update is available. When Gensler posted his initial goals, Commissioners Peirce and Roisman issued a statement criticizing the list of rules and regulations the Gensler Commission was seeking to address. Today, the two Commissioners are once again expressing their disappointment in Gensler’s agenda.

The two Commissioners have posted a statement labeled “Falling Further Back” calling Gensler’s agenda “ambitious in scope” but failing “to include any items intended to facilitate capital formation.”

“Instead, the agenda is brimming with plans to redo recently completed rules, add new regulatory obligations, and constrain investor choice,” chastised the two Commissioners.

At the very top of Gensler’s list (once again) are exempt securities offerings as well as a change to the definition of an accredited investor – a move that would most certainly aspire to limit access further to private securities.

See: 

More regulation coming: SEC Chairman signals stablecoins and other tokens could fall under its rules on security-based swaps

Hester Peirce on personal liberty, crypto regs and retail investor particiation

Hester Peirce: Lawless in Austin

To quote the statement but the Commissioners:

“One example is the proposal to alter the thresholds at which an issuer is required to register a class of securities with the Commission. In 2012, Congress enacted the bipartisan Jumpstart Our Business Startups (a.k.a., the JOBS Act), which, among other provisions aimed at improving capital access for newer companies, specifically raised these thresholds in order to allow companies greater flexibility in deciding whether and when to go public. This provision has been especially important for pre-IPO companies that use equity as part of their employee compensation arrangements and for startups in industries with high initial capital requirements. Lowering these thresholds may both contradict the express will of Congress and potentially undermine our mission to facilitate capital formation. A likely unintended consequence of lowering thresholds will be to limit the opportunity of employees, smaller investors, and other non-institutional investors to invest in promising businesses.”

Continue to the full article --> here

View the statement by the commissioners --> here

 

 


NCFA Jan 2018 resize - Gensler's Updated Regulatory Agenda Critized by SEC Commissioners Peirce and Roisman (Exempt Securities) The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

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Canada’s Low-Carbon Tech opportunity is now or risk another familiar story

BCG | Jason Green, Vinay Shandal, Wendi Backler, Keith Halliday, and Rachit Sharma | Dec 7, 2021

Low carbon tech investments - Canada's Low-Carbon Tech opportunity is now or risk another familiar story

First the good news. A global study of private investment by Boston Consulting Group’s Center for Growth and Innovation Analytics found that Canadian ventures are well represented across 13 key low-carbon tech sectors.  HTEC, Svante, Amp and Li-Cycle, for example, all attracted major funding over the past 12 months, making 2021 a banner year for private investment in the country’s low-carbon tech industry.

As much as US$21 trillion in new investment in both mature and newer low-carbon technologies will be needed globally over the next ten years.

In addition, Canadian low-carbon tech ventures are attracting a greater mix of investment in carbon capture, hydrogen, biofuels and climate analytics than their peers in Europe, the US or Asia-Pacific. BCG data shows they have claimed 8% or more of private investment worldwide since 2016. This is a hefty multiple of Canada’s roughly 2% share of the global economy. (See Exhibit 1 above.)

See:  Decarbonizing Crypto: Getting to the facts of the decarbonisation discussion

However, Canada’s history with past tech shifts suggests that while our venture record is strong, our scale-up record is poor. After a generation of internet innovation, for example, Shopify is the only Canadian company on the list of scale-ups with market capitalizations of more than US$50 billion.

Historically, a major reason has been a lack of sustained attention and investment from Canada’s public and private sectors.

BCG research shows that 80% of Canadian private investment—across the corporate sector, venture capital, private equity and financial institutions—currently goes to ventures located outside Canada.

It will be a regrettable irony if Canada ends up importing key low carbon tech from other places instead of fanning a booming economy in an area where we have already cultivated significant home-grown advantage.

See:  Are the new carbon offset ETFs too simplistic of a solution?

To help young businesses achieve scale, Canada’s public and private sector should take three steps.

  1. The first is for corporate Canada to ramp up venture investments and partnerships.
  2. The second step is for Canadian companies and government agencies to host more demonstration projects and at-scale deployments domestically.
  3. The final opportunity is to improve the innovation environment in Canada. To win the low-carbon future, we must get serious about addressing tax issues, low levels of corporate R&D, access to risk capital, and the brain drain of talent to the US.

Continue to the full article --> here


NCFA Jan 2018 resize - Canada's Low-Carbon Tech opportunity is now or risk another familiar story The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

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RBC Research: Preparing for Hyperdrive – Themes that will define our new future

RBC Wealth Management Research | Dec 7, 2021

preparing for hyperdrive RBC - RBC Research:  Preparing for Hyperdrive - Themes that will define our new futureGet ready for accelerated disruption. As we think forward to the future, progress will be faster than it has ever been and it will not be linear. Just as we did in our Landmark 2018 Imagine Report, in this thought leadership study we have taken a global, cross-sector approach to determining the themes that will define our new future.

Challenging our global research teams in their respective areas of expertise and coming together to share ideas in recent months, we identified five key themes investors and executives alike across all industries must collectively understand to prepare for the years ahead.

Themes that will define our new future

1. The Quest for Immortality – Biopharma breakthroughs, life science real estate, 5G, autos, consumer wellness, space exploration and more come together to increase life expectancy rates globally.

2. The Individual Revolution – Data monetization, blockchain, gene editing and an evolving gig economy put the individual front and center like never before.

3. Artificial Intelligence Activated – This is no longer a drill. The path is set for the latter stages of AI to be integrated into our global economy. Don’t be left behind.

See:  WEF Insight Report: Digital Assets, Distributed Ledger Technology, and the Future of Capital Markets

4. Hybrid Living – Our physical and digital worlds are rapidly combining, suddenly becoming indistinguishable and the implications are radical.

5. The Great Balancing Act – An accelerating rate of change on multiple fronts has the potential to create unprecedented instability. Resources are constrained and as we make tremendous forward progress on global sustainability, we must always keep in mind the other side of the coin. Innovation will thrive and new tensions will arrive.

Download the 263 page PDF RBC Research report --> here


NCFA Jan 2018 resize - RBC Research:  Preparing for Hyperdrive - Themes that will define our new future The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

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Senator Ted Cruz agrees that Bitcoin miners say they’re helping to fix the broken Texas electric grid

CNBC | MacKenzie Sigalos | Dec 5, 2021

fluctuating energy prices - Senator Ted Cruz agrees that Bitcoin miners say they're helping to fix the broken Texas electric gridAUSTIN, TEXAS – The Texas power grid is struggling with fluctuating energy prices and sporadic service, but the state's growing bitcoin mining community believes it can help fix it.

Republican Sen. Ted Cruz agrees. "A lot of the discussion around bitcoin views bitcoin as a consumer of energy," said Cruz at an event in October. "The perspective I'm suggesting is very much the reverse, which is as a way to strengthen our energy infrastructure."

The grid is called ERCOT — short for the Electric Reliability Council of Texas, which is the organization tasked with operating it — and it's fussy and temperamental.  ERCOT powers about 90% of the state, but to run smoothly, it requires a perfect balance between supply and demand. Having too much power and not enough buyers is just as bad as everyone wanting to fire up their AC units on the same day in July.

See:  MintGreen to make North Vancouver world’s first city heated by bitcoin

The price of power per hour is all over the place, routinely going negative. Rolling blackouts at moments of peak power consumption no longer come as a surprise. A lot of people lost faith in the grid altogether after a winter storm earlier this year resulted in a multi-system meltdown that "was within minutes of a much more serious and potentially complete blackout." 

Crypto enthusiasts believe the fix to this problem is actually to add another electricity consumer into the mix — a buyer who will take as much power as they're given, whatever the time of day, and are just as willing to power down with a few seconds' notice. These flexible buyers are bitcoin miners.

At the Texas Blockchain Summit in October, Cruz pointed to the ability of bitcoin miners to turn their rigs on or off within seconds — a feature that is hugely beneficial during times when energy needs to be shifted back to the grid to meet demand.

But not all are convinced that bitcoin miners are the solution.

"Miners are a strain on the grid, not a help," said Ben Hertz-Shargel of Wood Mackenzie, a provider of commercial intelligence for the world's natural resources sector. Hertz-Shargel is concerned that bitcoin mining would only raise peak demand, ultimately adding stress to the system.

See:  Hedera Hashgraph beats DLT competitors on energy consumption

As Lancium Chief Executive Officer Michael McNamara describes it, these sites act like a large power station but in reverse. The mines will absorb abundant renewable energy at times when supply outpaces demand, thereby monetizing these assets when there are no other buyers. And on the flip side, the mines will incrementally ramp down their energy intake, as demand on the grid rises.

In a sense, you can almost think of bitcoin miners as temporary buyers keeping these energy assets operational until the grid is able to fully absorb them.

Continue to the full article --> here


NCFA Jan 2018 resize - Senator Ted Cruz agrees that Bitcoin miners say they're helping to fix the broken Texas electric grid The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

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