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- Ethereum outperformed other cryptos with a total score of 78.
- Bitcoin’s low score of 7 on environmental parameters affected its overall ranking.
Proof-of-stake (PoS) blockchain Ethereum [ETH] ranked first in the final institutional rank ESG (Environmental, Social, Governance) ranking released by crypto market data provider CCData.
Ethereum is becoming investment-friendly
Ethereum was followed by popular altcoin projects such as Solana [SOL]Dot [DOT]and Binance Coin [BNB]. Interestingly, the world’s largest crypto asset is Bitcoin [BTC] ranked 26th out of 40 assets assessed.
The ESG benchmark, launched in partnership with the Crypto Carbon Ratings Institute (CCRI), rates some of the most liquid assets on the market across key environmental, social and governance parameters.
Source: CCData
Ethereum outperformed other cryptos with an overall score of 78. The asset scored above 28 on the social parameter, the highest on the list, while also performing well on the environmental and governance indices.
Ethereum, along with Solana, Polkadot and Binance Coin, earned the perfect “AA” grade. This was a significant improvement from the previous rankings, where only Ethereum scored the AA grade.
Bitcoin’s green credentials are inadequate
Bitcoin, on the other hand, could only achieve a score of 57.37. The crypto’s low score of 7 on the environmental parameter had a significant impact on the final score. In fact, this was the lowest rating of all assets surveyed.
Unsurprisingly, high energy consumption continues to damage Bitcoin’s green reputation. The proof-of-work (PoW) mechanism makes the network a major power guzzler, resulting in more greenhouse gas emissions.
Why ESG rankings matter
In recent years, there has been increasing recognition of the importance of ESG factors in investment decision-making. Projects that effectively manage ESG risks and opportunities are likely to generate more sustainable returns over time.
Furthermore, regulatory frameworks are also integrating ESG factors into their requirements. With the regulatory environment heating up in some jurisdictions, it made perfect sense for cryptos to focus on improving it.
