摩根士丹利-代码、资本与碳 数字资产和可持续投资 Code,Capital,and Carbon Digital Assets and Sustainable Investing

Morganstanley

INVESTMENTMANAGEMENT

calvert

Code,Capital,and

Carbon:DigitalAssets

andSustainableInvesting

DIGITALASSETS|October2026

DANDORMAN

ExecutiveDirector,CalvertResearchandManagement

1Messari.(2026).Totalcryptomarketcapitalization[Dataset].Blockworks.RetrievedasofSeptember30,2026.

OCTOBER2O26|MORGANSTANLEYINVESTMENTMANAGEMENT2

Thearchitectureofmoneyandfinancialsystems–longdominatedbysovereigncurrencies

andcentralizedintermediaries–isundergoing

aprofoundtechnologicalchange.Firstthrough

bitcointhenthroughotherblockchainand

distributedledgerapplications,wehavewitnessedthegrowthofpermissionlesssystemscapableofnearinstantaneousvaluetransferwithoutrelianceongovernmentsandthird-partyintermediaries.Attimes,sustainableinvesting,whichhasalso

experiencedconsiderablegrowthoverasimilarperiod,hasappearedatoddswiththedevelopmentofthevariousformsofdistributedledger

technology.Calvertbelievesthismissesthemark.

Withatotalmarketvalueof$2.9+trillionasofSeptemberof20261,digitalassetsarecomparabletosomeofthe

world’smostvaluablecompaniesandmonetarymetals.

Perspectivesfrominvestors,usersandregulatorsrun

thegamut–fromexcitementtocautiousoptimismto

outrightopposition.Whereskepticismandoppositionhaveexisted,particularlyamonginvestorspursuingsustainableinvestmentmandates,muchofthedebatehascentered

onthemorecontroversialaspectsofdigitalassets,such

astheenergyintensityofbitcoinminingorillicitactivity

thatleveragesthetechnology’spermissionlessnature.Buttheseareonlytwoofmanyfactorsindecidingwhethera

digitalassetallocationcanbecompatiblewithasustainableinvestingmandate.Perhapsabetterquestiontoconsideriswhyblockchaintechnologiesandsustainableinvestinghavebothexperiencedsubstantialgrowthoverasimilarperiodinfinancialmarkethistory.Webelievebothareresponding,atleastinpart,torealandperceivedshortcomingsin

institutionaltrustacrosssociety,includingwithinexistingmonetaryandfinancialsystems.

TheintellectualfoundationsofBitcoinandblockchain

technologywerelaidwellbeforetheGlobalFinancial

Crisis,yettheshadowofthecrisisprovedtobeacatalysttothisnewtechnologygiventhecorrespondingerosionoftrustintheglobalfinancialsystem.Institutionslong

regardedaspillarsofstabilitybecamesourcesofsystemicvulnerability,promptingreviewofcurrencysystemsand

traditionalfinancialintermediation.Thedecentralized

natureofblockchaintechnologywasaresultofefforts

toovercomepresumeddeficienciesoftrust,privacy,

censorshipandcentralizedpointsoffailure.Inthiscontext,thegrowthofsustainableinvestingreflectsaneffortto

strengthentrustinfinancialmarketsbycreatinglong-

termvaluewhilereducingnegativeexternalities,suchaseconomicinequalityorenvironmentaldegradation,thatcanultimatelyunderminemarketefficiency.

Digitalassetscanenablenewopportunitiestoimprove

andexpandexistingfinancialsystemsto(i)increase

financialinclusionthroughpermissionlessaccess,(ii)

reducefrictioninpaymentsandsettlementcosts,(iii)

hedgecurrencydebasement,andincreasingly,(iv)innovateattheintersectionofdigitalinfrastructureandthe

energytransition.Withgreaterregulatoryclaritynow

emerging,mostnotablyintheU.S.,digitalassets’positivefoundationalattributesarelikelytobecomemorecentraltotheglobalfinancialecosystem.

TheEthosofBitcoin

ThebirthoftheBitcoinProtocolwastheculmination

ofdecadesofdevelopmentinvariouscomputerscience

disciplines.Priorinnovationsinpublic-keycryptography

andhash-basedproofslaidthegroundwork,butthe

persistentchallengehadbeenthedoublespendproblem–

thetechnicaldilemmaofpreventingdigitaltokensfrombeingcopiedorreusedwithoutatrustedarbiter.ItwasSatoshi

Nakamoto’sinsighttostitchtheseinnovationstogetherwithadecentralizedconsensusmechanismimplementedthroughproof-of-workandasharedpublicrecordoftransactionsthatestablishedaprotocolwheresharedeconomicincentives

couldreplacecentralizedauthority.

Hisinnovationreflectedadocumentedconcernwiththestructuralfragilitiesofconventionalfinance,particularlytherelianceontrustedintermediariesandthecapacityofcentralbankstoexpandthemoneysupplyattheir

discretion.ThismotivationismostdirectlyexpressedinBitcoin’sdesign:afixedissuancescheduleandhard-

cappedsupplythatremovesmonetarypolicyfromhumandiscretion,andapublic,auditableledgerthatallowsanyparticipanttoverifythesystemwithoutrelyingona

centralauthority.Moresuccinctly:monetaryrulesshouldbepredictable,verifiableandnotsubjecttodiscretionarypoliticalinterference.

Earlycollaboratorswerenotdrawnbyspeculation,

butbythepromiseofadecentralizedmonetarynetworkthatoperatedoutsidetheexistingfinancialsystemandanassertionthatmonetarytrustcouldbeembeddedinalgorithmiccertaintyratherthaninstitutionalreliability.

Bitcoindidmorethanmerelyintroduceanewassetclass

–itintroducedanewmethodoffinancialparticipation.It

recognizesmoneyasmorethanamediumofexchange,andatitscore,asasocialcontractandabasisforparticipationinacivilsociety.Bitcoin’spermissionlessdesigneliminatestheneedforinstitutionalonboarding,credithistoryor

government-issuedidentification,whichisparticularlyusefulinregionswherebankinginfrastructureisscarce,unstableorexclusionary.Itsfunctionalneutralitydoesnotdiscriminatebetweenusersanddoesnotimposeconditionsonitsuse.

Thisinherentlyalignswithimprovingaccesstofinancialservices,asharedaimofsustainabledevelopment.

Butnonetheless,permissionlessblockchainsdocreaterealchallengesandnegativeexternalities.Onesuchchallengeisillicituse.Illicitactivityusingsomeformof

cryptocurrencycontinuestogrowandamountedto

approximately$154billionin2025

2

,whichrepresents

closeto1%ofattributabletransactionvolume.Thisillicitactivityisalsoincreasinglyprofessionalizedandusedby

nationstateactorstocircumventWesternsanctions.

2

Criticsalsopointtotheconcentrationofbitcoinownershipamongarelativelysmallsetofholdersandarguethattheembeddedgainsofearlyadoptersriskreinforcingwealthinequality.Thisisadistributionaloutcometheprotocol’srule-basedneutralitywasneverdesignedtoaddressandadynamicthatislikelytopersist,atleastinthenear

term.However,participationappearstohavebroadened

considerably,withthenumberofwalletaddressesholdingbitcoinincreasingsubstantiallyinrecentyears.Bitcoin’s

effectivenessasastoreofvaluealsoremainssubjecttodebate,giventhatrealizedoutcomeshavehistorically

dependedheavilyonentrytiming.Someofthisvolatilitymayreflectanassetstillprogressingalongitsadoption

curve,althoughexcessiveleverageandmarketcyclicalityhavealsocontributedtoitshistoricallypronouncedpriceswings.Indeed,bitcoin’simpliedvolatilityhascompressedtomulti-yearlowsin2026,whilesuccessivemarketcycleshaveproducedprogressivelyshallowerdrawdowns.

FinancialInclusionandtheProliferationofStablecoins

Perhapsthemostprevalentdigitalassetusecasebeyond

bitcoinisthestablecoin,adigitaltokenpeggedtoafiat

currency,99%ofwhicharepeggedtotheU.S.dollar(USD).Thegrowthofstablecoinsfromzerotoa$300billion

3

marketinlessthanadecadeisperhapsoneofthegreatestfinancialinclusionnarrativesofourtime,especiallyin

emergingandfrontiermarketswherelocalcurrenciesremainvolatile.Tether(USDT),thelargeststablecoinbyvalueandapproximately70%ofthemarket,nowboastsmorethan

500millionusersglobally.

4

Bycombiningrelativeprice

stabilitywithnearimmediatetransmissionandsettlement,stablecoinsaddressfrictioninpaymentsandremittances.

Usecasesforstablecoinsandfinancialinclusionarenumerous:

BANKINGTHEUNBANKEDWITHOUTABANK

Approximately1.3billionadultsremainunbanked

5

,yet

inmanyofthesemarkets,mobilephonepenetration

exceedsaccesstobanking.Becausestablecoinscanbe

heldinself-custodieddigitalwalletsonmobilephones,onboardingcanbeprocessedvirtually,enablinggreatercompetitionandcustomerchoicewhilereducingfrictionandtransactionfees.Assmartphoneadoptionrises

acrossemergingmarkets,wherebankaccountownershiplagsglobalaverages,thesedevicesprovideascalable

distributionchannelforstablecoins.

2Chainalysis.(2026,March5).The2026cryptocrimereport.

3DeFiLlama.TotalStablecoinSupply[dataset].DatathroughAugust30,2026.

4TheBlock.(2025,October21).Tetherhits500millionusersasstablecoinsupplynears$182billion.

3

5Klapper,L.,Singer,D.,Starita,L.,&Norris,A.(2025).TheGlobalFindexDatabase2025:Connectivityandfinancialinclusioninthedigitaleconomy.WorldBank.OCTOBER2O26|MORGANSTANLEYINVESTMENTMANAGEMENT

OCTOBER2O26|MORGANSTANLEYINVESTMENTMANAGEMENT4

GrowthinTotalStablecoinSupply(USD)

350B300B250B200B150B100B 50B0

201720182019202020212022202320242025

USDTUSDCOther

Source:DeFiLlama,DatathroughAugust31st,2026.USDT(TetherUSD)isaU.S.dollar–peggedstablecoinissuedbyTetherLtd.;USDC(USDCoin)isaU.S.

dollarpeggedstablecoinissuedbyCircleInternetFinancial;Otherrepresentstheaggregatevalueofthenext23largestU.S.dollar–peggedstablecoinssothatthetotalstablecoinsupplyrepresentstheaggregatevalueofthetop25USDstablecoins.

FACILITATINGFLOWS

Globalremittanceflowsexceeded$850billionannuallywithanaverageremittancecostof~6%pertransaction,materiallyabovetheUNSustainableDevelopmentGoalof3%.6Stablecoinsnotonlyenablenear-instantcross-bordertransfers,butalsosettlementfeesoftenmeasuredin

centstoafewdollars.FormigrantcorridorssuchasU.S.–LatinAmericaorthePersianGulf–SouthAsia,stablecoinstranslatetofaster,incrementalincomeforsomeofthe

world’spoorestcommunities.

PURCHASINGPOWERSTABILITY

Inhigh-inflationeconomies,especiallycountriesfacing

significantcurrencydebasement,stablecoinsfunction

asadigitalproxyforhardcurrency.Intheseenvironments,accesstoUSDbankaccountsmayberestrictedorcapitalcontrolsmayapply,butUSD-peggedstablecoinsprovideuserswithaportablehedgeagainstlocalcurrency

volatility.Forexample,in2019whenLebanon’slocalcurrencylostover90%ofitsvaluerelativetoUSD,stablecoinusageincreased.

LIQUIDITYFORAGROWINGPOOLOFFINANCIALAPPLICATIONS

Stablecoinshavebecomeacorepillarofdigitalassetinfrastructurewithmonthlyon-chaintransfervolumes

reachingintothetrillionsofdollars.Ethereum,the

secondlargestblockchainbymarketcapitalization,isa

decentralized,programmablenetworkthatunderpinsalargeshareofcryptoactivityandaccountsforaroundhalfofallstablecoinsupply.Ethereum’ssmartcontractfunctionalityenablesstablecoinstomoveseamlesslyacrosswallets,

exchangesanddecentralizedapplications,makingitthe

primarysettlementlayerfordollar-denominateddigital

valueon-chain.OnEthereumalone,stablecoinvolumesnowexceed$2trillionpermonth,comparabletotheroughly$27trillionincombinedannualtransactionvolumesprocessedbyVisaandMastercardin2025.7

Thisgrowingecosystemcanalsosupportdecentralized

finance(DeFi)applicationsofferinglendingandcollateralizedborrowingproducts.Whileriskmanagementandregulatoryoversightremaincriticalandstillunderdevelopedinmany

markets,stablecoinscancreatepathwaysforunderbankeduserstoaccesspaymentandcreditinstrumentswithout

relyingonstandingbankingrelationshipsorcredithistories.

Itisimportanttonote–thefinancialinclusioncaseforstablecoinsisnotpredicatedondisplacingbanks,butonaugmentingaccess.Thecombinationofrelativestability,lowsettlementfrictionandprogrammablefunctionalitypositionsstablecoinsasascalablesolutionforinclusive

6WorldBank.(n.d.).RemittancePricesWorldwide[Dataset].RetrievedAugust9,2026.

7TheBlock.(2026).Ethereumon-chainvolumeofstablecoins[Dataset].RetrievedMay11,2026.

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EthereumOn-ChainStablecoinTransactionVolumes($)

Jul-23

Aug-23

Sep-23

Oct-23

Nov-23

Dec-23

Jan-24

Feb-24

Mar-24

Apr-24

May-24

Jun-24

Jul-24

Aug-24

Sep-24

Oct-24

Nov-24

Dec-24

Jan-25

Feb-25

Mar-25

Apr-25

May-25

Jun-25

Jul-25

Aug-25

Sep-25

Oct-25

Nov-25

Dec-25

Jan-26

Feb-26

Mar-26

Apr-26

May-26

Jun-26

Jul-26

Aug-26

3.5

3.0

2.5

2.0

1.5

1.0

0.5

0

VolumeinTrillions

Source:TheBlock,DatathroughAugust31st,2026.Theon-chainvolumeofstablecoinsshowstheaggregatevalueinUSDoftransfersonEthereum.

finance.Durableimpactwilldependhoweveronregulatoryclarity,consumerprotectionandintegrationwithcomplianton-andoff-rampsacrossjurisdictions.Butasdigitalassetsmatureandoperateunderincreasinglysupportiveregulatoryregimes,financialinclusionwillonlyproliferateandsupportsustainabledevelopmentaims.Forinvestorswithastrongemphasisonsustainability,akeyquestionarises:Arethe

potentialbenefitsofdigitalassetsforfinancialinclusionmateriallyundervalued?

SmartContractsand

ProgrammableInfrastructure

Whilestablecoinsareoneoftheclearest,financially

inclusiveapplicationsofdistributedledgertechnology,thesmartcontractplatformssupportingtheseecosystems

mayultimatelyproveequallyimportantfrombothan

energyefficiencyandfinancialaccessperspective.NetworkssuchasEthereumandSolanacanenableabroadrangeof

applicationsrelatedtopayments,lending,insurance,identity,capitalformationanddigitalcommercebecauseofthe

programmabilityofsmartcontracts.

Ratherthanrelyingoncontinuous,computational

competitiontosecuretheledger,liketheproof-of-work(PoW)protocolofBitcoin,proof-of-stake(PoS)utilizes

cryptographicvalidationandeconomicincentivesthrough

bondedcollateral.InSeptember2022,EthereumtransitionedfromPoWtoPoSinoneofthemostsignificantenergy

efficiencyupgradesundertakenbyamajorblockchain.

Estimatesofthenetwork’selectricityconsumptionbeforeandafterthetransitionindicateareductionofover99%,whileEthereumhasmaintaineddecentralizednetwork

functionalityandbroadglobalparticipation.8

Solana,alternatively,wasarchitectedaroundhigh-throughputprocessingandlowoperationalcostswithcomparatively

minimalenergyexpenditureonapertransactionbasis.Thisefficiencyhasimplicationsnotonlyforresourceconsumption,butalsoforaffordabilityandscalabilityofconsumer-facingapplications.TransactionfeesonSolanaareoftenmeasuredinfractionsofacent,facilitatingmicrotransactionsandhigh-frequencyfinancialactivitydifficulttosupportthroughmanytraditionalpaymentrails.

Importantly,smartcontractplatformsshouldnotnecessarilybeviewedasareplacementfortraditionalfinance,but

ratherasapotentialupgradetocertainusecasesand

processeswherematerialfrictionscontinuetoexist.Banks,paymentnetworksandcapitalmarketscontinuetoplay

criticalrolesincreditcreationandfinancialintermediation.Atthesametime,programmableblockchainnetworks

8Neumüller,A.,Sims,H.,Coelho,H.,Wu,W.,Bear,K.,Arner,D.W.,Proskalovich,R.,&Zhang,B.Z.(2026).EthereumaftertheMerge—Achangeinpower:Evaluatingthepost-Mergeenvironmentalfootprint.CambridgeCentreforAlternativeFinance,CambridgeJudgeBusinessSchool.

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mayimprovecertainareasoffinancialfunctionality,

particularlywhensettlementspeed,interoperability,

accessibilityorautomationareimportantconsiderations.

Beyondfinance,programmableblockchainssupport

emergingapplicationsrelatedtodigitalidentity,

transparentcharitabledistributionandtokenized

ownershipstructures.Whileearly,theydemonstrate

howsmartcontractplatformscansupportbroader

formsofdigitalcoordinationandeconomicparticipation.

Forinvestorsevaluatingdigitalassets,theanalysisincreasinglyextendsbeyondcryptocurrenciesandtowardthefunctionalityoftheunderlyingnetworksthemselves.Ethereumand

Solanaillustratethatblockchainsystemscancombineloweroperationalintensitywithscalablefinancialinfrastructure

capableofsupportingawiderangeofapplications.

Bitcoin,Proof-of-WorkandtheGlobalEnergySystem

Formanyinvestorswithsustainabilitygoals,theenergy

consumptionoftheBitcoinNetworkisofcentralinterest.

Bitcoin’sPoWconsensusmechanismiscomputationallyheavyandenergyintensive,butitisthisenergythatprovidesthe

securityunderpinningBitcoin’spermissionlessandcensorship-resistantfinancialtransactions.Whensovereigncurrencies

canfacedebasementtosatisfynear-termneedsand

politicalaims,groundingascarcemonetaryassettoenergyproductionisatthecoreofBitcoin’svalueproposition.

FocusingsolelyonBitcoin’senergyconsumptionprovides

anincompletepictureofitsvalue.Inourview,bitcoinmininghasthepotentialtofunctionasacatalystwithincertain

aspectsoftheenergytransition.Threeunderappreciateddimensionsofbitcoin’srelationshipwithenergydeserve

mention:(i)itsabilitytoenhancegridstability,(ii)its

potentialtoimproveuniteconomicsforrenewableenergy,and(iii)thepossiblereductionofgreenhousegas(GHG)emissionsthroughmethanecapturetofuelbitcoinmining.

Bitcoin’stotalenergyusecannotbedirectlymeasured,soapproximationreliesontheoreticalmodelingandsurveydata.Bitcoinmining’selectricityconsumptioniscurrently

ANoteonProof-of-WorkandProof-of-Stake

Proof-of-Work(PoW)andProof-of-Stake(PoS)blockchains

differfundamentallyinhowtheysecurethenetwork,resultingindramaticallydifferentenergyprofiles.PoWsecuresthe

networkthroughexternalresourceexpenditure,namely

energyandspecializedhardware,whilePoSsecuresitthroughinternaleconomicbonding:validatorslockupcapitalthat

canbepenalized,or“slashed,”formisbehavior.Bothrelyoncryptography,butPoSachievessecuritywithoutPoW’scontinuousenergycost.

Theirsecurityguaranteesarenotequivalentbutreston

differentassumptions.Whichmethodisstrongerdependsonthetypeofattackconsideredandremainsactivelydebated.

PoWoffersalongerrecordofadversarialexposureandties

securitytophysicalcoststhataredifficulttofake,butitis

energy-andcapital-intensive,andinpracticeminingcanbe

concentrated.PoSisfarmoreenergy-efficientandallows

participationwithoutspecializedhardware,butitisnewer,hasashortertrackrecord,anddependsonadditionalassumptions,suchasstakingthatcanconcentrateamonglargeproviders.

Bitcoin(PoW)reliesonminersrepeatedlyhashingblockdatawithspecializedhardwareinaracetomeetanetwork-set

difficultytarget.Thisprocessisdeliberatelyenergy-intensive:

securityisderivedfromtheeconomicandphysicalcostof

expendingelectricity.Bitcoin’stotalenergyconsumptionis

drivenbyfactorssuchasminingdifficulty,hardwareefficiency,electricityprices,andthevalueoftheblockreward.Energyusescaleswiththeeconomicsofsecuringthenetworkratherthanwithtransactionvolume.

Bycontrast,Ethereum(PoS)replacedminingwithstakingin

its2022“Merge.”Validatorsarepseudo-randomlyselected,

weightedbytheETHtheylockupascollateral,toproposeandattesttoblocks.Thiseliminatestheneedforenergy-intensivemininghardware,andEthereum’senergyconsumptiondroppedbyroughly99.95%afterthetransition.(SeeFootnote9).

estimatedtobe~138TWhperyearorabout0.5%ofglobalelectricityconsumption,andsurveyssuggestamajority

ofthisconsumptionisderivedfromsustainablesources.9

Bitcoinminingisalsounusuallyportable.AnApplication

SpecificIntegratedCircuit,orASIC,istheprimarycomputerhardwarethatisusedinbitcoinmining.ASICsaremodularandlargelylocation-agnosticsoasubstantialshareof

computationalneedscanmigratetowardthelowest-costenergysources.Thisflexibilitywasdemonstratedin2021when60-75%ofthenetwork’scomputationalpower,thenlocatedinChina,wasforcedofflineandredeployedacrossnewgeographieswithinmonths.Eveninsteady-state

9Neumueller,A.,Pieters,G.C.,Mohaddes,K.,Rousseau,V.,&Zhang,B.Z.(2025,April28).Cambridgedigitalminingindustryreport:Globaloperations,sentiment,andenergyuse.CambridgeCentreforAlternativeFinance,CambridgeJudgeBusinessSchool.

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ElectricityConsumptionofBitcoinMiningbySource

ElectricityConsumptionofType

RenewableFossilFuels

Sustainable

ElectricityConsumptionbySource

HydroNuclear

WindGas

SolarCoal

OtherrenewablesOil

Source:CambridgeCentreforAlternativeFinance.CambridgeDigit

lMiningIndustryReport.April2025.

42.6%

15.4%

3.2%

0.5%

39.8

CO2Equivalent

(MtCO2e)

52.4%

9.8%

47.6%38.2%

0.5%

23.4%

inMillionTonnes

8.9%

a

conditions,mininghasshownseasonalmobility,chasingcheaperhydroelectricpowerduringrainyseasons.10

GRIDSTABILITYANDFLEXIBLEDEMAND

Electricitygridsareundergoingstructuraltransformationdueinparttotheenergytransitionandthegrowingdemandforpower.Asintermittentrenewablessuchaswindandsolar

gainshare,variabilityandsupply-demandmismatcheshave

increased,creatingoperationalchallenges.Withinthiscontext,bitcoinminingrepresentsadistinctformofelectricitydemandasminingloadscanbecurtailed,rampeddownorshut-off

withinminuteswithoutdamagingequipmentorincurring

significantrestartcosts,differentiatingitfrommostindustrieswithrigidbaseloadneeds.

Intraditionalgrids,short-termdemandisrelativelyinelastic,requiringoperatorstorelyonpeakingplantsorreserve

capacitytomanagespikesinelectricitydemand.Flexible

demandresourceslikebitcoinminingcanreducesystemcostsandenhancegridreliability.Duringperiodsofgridstress,

minerscancurtailconsumption.Duringperiodsofexcess

generationandlowprices,minerscanabsorbsurpluselectricity.

InTexas,whererapidwindandsolarexpansionhasledattimestonegativeornear-zerowholesaleelectricityprices,minersareabletofunctionasa“buyeroflastresort,”

monetizingsurplusenergysorenewablegeneratorsare

notforcedtocutoutputandreducerevenues.Conversely,duringextremeweatherevents,minersparticipatingin

demandresponseprogramshavecurtailedoperations,

allowingenergytobeusedformorepressingconsumerneeds.Importantly,thisflexibilityiseconomically

incentivized,aligningprivateincentiveswithgridreliabilitywithoutregulatoryoradministrativemandates.

UnlikecloudorAIdatacenters,whichrequirelatency-

sensitiveormission-criticalbaseloadpower,bitcoinmininghasnosetobligations.Blockscanbeminedanywhere

andtemporaryshutdownsbyindividualminersdonot

impairnetworkintegrity.Whencriticsarguethatadding

demandinherentlyincreasesgridstress,manyassume

homogeneous,inflexiblepowerdemand.Bitcoinmining

representsasourceoflarge-scaleandeconomically

motivatedflexibledemand,whichareincreasinglyvaluableattributesincomplexpowersystems.

Importantly,thesebenefitsarecontextdependentrather

thanuniversal.Bitcoinminingismostlikelytosupportgrid

efficiencywhereelectricitysystemsexperienceperiodic

surplusgeneration,minersparticipateinenforceable

curtailmentprograms,marketrulesappropriatelycompensateflexibledemand,andminingdoesnotmateriallyincreasecostsorothernegativeexternalitiesforconsumersandcommunities.

10CambridgeCentreforAlternativeFinance.(n.d.).CambridgeBitcoinminingmap[Dataset].RetrievedAugust9,2026.

Suchaswithotherflexibleloads,outcomesultimatelydependonlocalelectricitymarketdesignandoperatingconditions.

Lookingahead,agrowingnumberofminingcompaniesare

diversifyingintoAIandhigh-performancecomputing(HPC),attractedbystrongereconomicsforcertainworkloads.Unlikebitcoinmining,however,AIandHPCworkloadsgenerally

requirehigheruptime,lowerlatency,andmorereliablepower,makingthemlesssuitableasflexibledemandresources.

RENEWABLEENERGYUNITECONOMICS

Beyondgridoperations,bitcoinminingmayalsoimproverenewableprojecteconomics.Renewablegeneration

costshavedeclinedsubstantially,butmonetizationcanremainchallenging.Asrenewablepenetrationincreases,wholesalepricesduringpeakgenerationoftenfalland

curtailmentsfurthererodereturns,particularlyinregionswithtransmissionconstraintsorunevendemand.

Bitcoinminingintroducesanincrementalrevenuestream

withoutrelianceonsubsidiesorlong-termpowerpurchaseagreements.Byco-locatingminingrigswithrenewable

assets,minerscanmonetizeexcessorstrandedoutput.

Forexample,inpartsofEastAfrica,bitcoinminerspartnerwithrenewablemini-gridsanduseminingtoabsorbsurplusgenerationwhenlocaldemandislow.Thiseffectivelyaddsanewrevenuestreamthatcanhelpsmallrenewableplantsandmini-gridsbecomemorefinanciallyviablesotheycandeliverelectricitytochallenginglocations,supportinga

hostofdevelopmentneeds.Evenmodestimprovementsincapacityutilizationcanmeaningfullyenhanceinternalratesofreturnofrenewableprojects.

Renewableenergygenerationcertainlydoesnotdependonbitcoinminingforlong-termviability,butminers’price-sensitivityandflexibilityalignnaturallywithrenewable

generationprofiles.Still,miningrevenuesarevolatileandregulatoryuncertaintiespersist–bitcoinminingshouldbetreatedasasupplementarysourceofrevenueratherthanfoundationaltorenewablepowerprojectmodels.Butthefactremains,theBit