Blockchain Ethical Issues Explained

Blockchain technology is a term which is becoming more and more popular day by day. Many institutional investors have also started using it,as a as have many states across the world.

However, this technology has already managed to garners its fair share of criticisers who amongst other things are most concerned about the privacy and security of this technology seeing that there is no central authority to regulate it and it is decentralised.

As is common with all technology it will have a ethic and guide for its development.

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So, as far as ethical grounds as concerned blockchain technology raises two very pertinent problems. The first problem is with regards to its effect on the environment and the other one is about its apparent enabling of criminal activity.

1. The environment

If you’ve read our various articles on understanding blockchain, you know that raw computing power is what drives the technology.

And since blockchain networks rely on encryption and the solving of complex mathematical puzzles, the amount of computing power needed to run them naturally is enormous.
The stats regarding the power consumption of cryptocurrencies are ate still quite impressive.

According to Morgan Stanley, the Bitcoin blockchain alone will use as much power in 2018 as the entire nation of Argentina.

Bitcoin’s current estimated annual electricity consumption is 61.4 TWh which is 1.5 percent of the United States’ annual consumption.
UK-based energy comparison service PowerCompare is of opinion that the total annual electricity usage of the Bitcoin blockchain exceeds that of 159 nations.

Bitcoin is now takes up 0.6 percent of the world’s entire electricity usage.
In a world that should start thinking about excessive energy usage, developers need to find a way to verify transactions much more efficiently.

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2. Cybercrime

If you look back at the early days of Bitcoin, you could argue that the cryptocurrency’s price increases were mostly driven almost exclusively by criminal and illegal activity.

Increasing activity of dark web websites, and subsequently the rise of cybercriminals who use it to sell drugs, weapons, and other banned items safely and anonymously with Bitcoin—not to mention the obvious benefits that untraceable financial transactions offer to money launderers.

Does the problem still exist?

Yes, even though mainstream adoption has increased, cryptocurrencies are still largely the payment method of choice for anyone acting illegally. For example, if you’ve ever been unlucky enough to suffer from a ransomware attack, you’ll almost certainly have seen Bitcoin as the payment method. Even less dangerous criminals, such as those selling NZB indexing services, now want to be paid in crypto.The question of ethics and duty becomes very important here.

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Rishma Banerjee

Rishma is currently pursuing a bachelor’s degree in International Relations and has a special place in her life for sifting through all sorts of random trivia, thank you very much.