Cryptocurrency has become the face of modern finance and it is the root cause of the revolution in DeFi and Game-Fi. Cryptocurrencies have changed the way philanthropy and donations happened. The donations through crypto assets are tax-deductible. On having a Schedule A and itemizing donations, one can deduct the amount of donation without capital tax gains. The main reason why companies accept crypto donations is that the transactions are transparent and encrypted. No one really knows the private keys of the charity wallets, thus the funds reach the destined ends safely. Also, there are no longer procedures and paperwork for donations. The donation reaches the companies within a business day. Companies that expect a safer and more transparent way of accepting donations choose crypto over fiat currencies.
Mozilla says no to Bitcoin
Mozilla, a non-profit organization had been accepting crypto donations since 2014. It had not reassessed the decision of accepting PoW cryptocurrency after publishing its climate commitments. Finally, in 2022 Mozilla had a heated discussion about the acceptance of PoW cryptocurrencies as the cryptocurrency's environmental toll has become more apparent.
Based on the feedback from staff and supporters, Mozilla tried to understand the impacts of cryptocurrency on the environment and revised its decision of accepting PoW crypto assets. The revised donation policy states that Mozilla will no longer accept 'Proof-of-Work' cryptocurrencies. Instead, Mozilla will accept 'Proof-of-Stake' which is less energy-intensive when compared to Bitcoin. Mozilla will come up with a list of PoS cryptocurrencies it will accept by the end of Q2 2022.
Why Does Mozilla make a transition?
Mozilla's decision not to accept Bitcoin is due to its informed climate commitments. In 2021, Mozilla stepped forward to reduce its carbon footprint, aiming to stay behind the net-zero emissions commitment of the Paris Climate Agreement. The acceptance of Proof of Work cryptocurrencies prevented Mozilla from achieving its goal as these assets significantly increase Mozilla's greenhouse gas footprint due to their energy-intensive nature. Now, the new donation policy ensures that Mozilla's fundraising activities will not get affected while it remains aligned with emissions commitment.
No BTC, No ETH
By getting rid of PoW donations, Mozilla says no to all Non-PoS crypto including Bitcoin and Ethereum. Ethereum will still be considered a PoW crypto-asset until the Ethereum blockchain adopts a PoS consensus mechanism in the near future. By rejecting the leading cryptocurrencies in terms of market capitalization and trading volume owing to its climate commitments, Mozilla plays a positive role in the industry. Mozilla is doing a great job by being transparent about its energy consumption pattern and it has promised to help design, and develop products from a sustainability perspective.
If not Bitcoin and Ethereum, what would be the coins that join the list of Mozilla's acceptance list? There are a few recent PoS native coins that attracted a lot of crypto holders worldwide. These coins include BNB, SOL, and AVAX.
Opposition to Mozilla's Decision
While Mozilla's decision seems to have a positive impact on the environment, the Director of Digital Strategy at American investment firm VanEck Gabor has seriously condemned it. He's not happy with what Mozilla did. He considered Mozilla's decision misguided and virtue signaling in nature. He says Bitcoin is one of the greenest industries out there and Mozilla is totally blindfolded about the fact.
While the energy consumption of Bitcoin is estimated at 204.5 TWh, the actual effect of Bitcoin on climate is much more contested. The miners today use renewable energy for mining and they are keen on strengthening the energy grid and improving carbon efficiency while mining. According to research, Bitcoin mining uses data centers that switch between self-generated green energy and tapping into the public grid to reduce stress on the public grid and eliminate adverse environmental effects.
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