Royal Bank of Canada: Bitcoin Mining and Climate Change (Digital Learning Experience)

In its effort to fight climate change, the Royal Bank of Canada (RBC) established its RBC Climate Blueprint, an enterprise strategy to accelerate clean economic growth and support its clients in a socially inclusive transition to net-zero. RBC holds itself accountable to this plan through its Environment, Social, and Governance (ESG) Performance Report, which quantifies the bank’s climate change actions. Any business activities that contradict RBC’s strategy may adversely impact the bank’s reputation. This study was carried out in response to a strategic decision-making requirement from RBC regarding Bitcoin and new technology investment. The case discusses the definition of cryptocurrency, the Bitcoin mining process, energy consumption associated with the mining procedure, and the impact of Bitcoin mining on climate change. After thoroughly describing and analyzing each topic, we will draw conclusions about the effects of Bitcoin mining energy consumption on climate change. At the end of the study, we will be able to answer this question: What environment-related reputational risk might RBC face if the bank were to support products and services around Bitcoin?