Number of Mined Units Traded On the Cryptocurrency Network and Global Carbon Emissions: An ARDL Boundary Testing Approach

Abstract

This paper investigates the relationship between the number of units extracted from cryptocurrency traded on their network and the increase in global carbon dioxide emissions. The analysis is based on monthly data for eight cryptocurrencies (independent variables) and carbon dioxide (CO2 dependent variable) extending from July 2015 to February 2023, the autoregressive distributed lag (ARDL) model was used. The results extracted from the bounds test showed a long-term relationship between the variables, with Dash and Bitcoin having a greater impact than other cryptocurrencies. The results of the error correction model (ECM) estimation also demonstrated that the adjustment speed from the short term to the long term is 24.50% per year. Therefore cryptocurrencies, especially the Dash and Bitcoin currencies, contribute to the increase in carbon dioxide emissions but with a negligible effect.