ESG initiatives are essential to attracting institutional investors’ funds: “Consensus 2023” participant survey | CoinDesk JAPAN

A significant portion of global institutional capital is now focused on ESG (Environmental, Social and Governance). According to a report released by PricewaterhouseCoopers (PwC) in October 2022, global ESG-related assets under management (AUM) will reach $33.9 trillion by 2026 (approximately ¥4,750 trillion, at an exchange rate of ¥140 to the dollar). , accounting for 21.5% of global AUM.

Simply put, if a crypto/blockchain company wants to attract institutional money, it needs to have an ESG commitment.

This article is an excerpt from CoinDesk’s report “Consensus @ Consensus”, which summarizes the group discussion held at “Consensus 2023”. Read the full report here.

While some in the cryptocurrency industry reject ESG as an esoteric endeavor, participants in the discussion at Consensus 2023 were optimistic, and the theme was how to embrace ESG without alienating it.

The most obvious and simplest solution is to encourage the adoption of Proof of Stake (PoS) consensus mechanisms. By depositing their crypto assets, users become validators of transactions (more than half of the 165 people who responded to the survey said it was the best option for dealing with climate change).

“Proof of Work (PoW) and Proof of Stake (PoS) are just scratching the heads of many in Washington,” says one Consensus 2023 attendee who has served in Congress In a discussion, People continued, “Blockchain being used as a utility to solve real-world problems is the first step towards getting this problem right.”

While attendees disagreed on key issues such as whether blockchains should stop carbon-intensive mining processes, they did agree on the disconnect between the crypto industry and regulators. .

Until the crypto industry starts speaking the language of Washington D.C. and being able to converse with people in the Capitol, there will be little point of understanding about crypto’s ESG efforts… here.

｜Translation: coindesk JAPAN
｜Editing: Takayuki Masuda
｜Image: Consensus 2023 panel discussion (Shutterstock/CoinDesk)
｜Original: If Crypto Wants Institutional Dollars, It Needs an ESG Game Plan: Consensus 2023 Attendees