Are Virtual Currencies Virtuous? Ethical and Environmental Issues

  • Sondes MbarekEmail author
  • Donia Trabelsi
  • Michel Berne
Part of the Contributions to Management Science book series (MANAGEMENT SC.)


Cryptocurrencies have gained in popularity and generated a great deal of enthusiasm in recent years with regard to the sustained increase in the number of transactions achieved by miners. On what scale can we consider the process and uses of virtual money to be ethical? What are the misuses related to their use? In this chapter, we study the ethical and environmental issues of cryptocurrencies. First, regarding the environmental issue, the major cryptocurrencies use a large amount of electricity for mining, which has a significant impact on the energy production system and global warming. Second, we discuss the new type of Dark economy that has emerged with these currencies, thanks to the anonymity of transactions. We particularly emphasize the unethical use of cryptocurrencies, namely the virtual money laundering and tax evasion, the financing of illegal activities (i.e. illicit products, terrorist financing) and cyber-attacks. Third, we develop the ethical use of virtual money and show that this kind of currency, which guarantees the protection of privacy and anonymity of transactions, can be a good solution to mitigate transaction costs and reduce poverty. They can also be beneficial in the context of debt crises and hyperinflation. Thus, cryptocurrencies per se are not evil; it is their uses that can be.


Virtual currencies Energy consumption Environmental impact Illegal activities 


  1. Aldridge J, Décary-Hétu D (2014) Not an ‘Ebay for Drugs’: the Cryptomarket ‘Silk Road’ as a paradigm shifting criminal innovation. Available via SSRN 2436643. Accessed 29 Apr 2019Google Scholar
  2. Angel JJ, McCabe D (2015) The ethics of payments: paper, plastic or Bitcoin? J Bus Ethics 132(3):603–611CrossRefGoogle Scholar
  3. Australian Transactions Reports and Analysis Center (AUSTRAC) (2012) Typologies and case studies report. Australian Government. Accessed 23 Apr 2019
  4. Australian Transactions Reports and Analysis Center (AUSTRAC) (2014) Typologies and case studies report. Australian Government. Accessed 16 May 2019
  5. Beigel O (2018) What is Darkcoin|How to buy darkcoin? Accessed 19 Apr 2019
  6. Bevand M (2017) Electricity consumption of Bitcoin: a market-based and technical analysis. Accessed 10 March 2017
  7. Blockchain Luxemburg SA (2019)
  8. Brandom R (2017) Ransomware victims have paid out more than $25 million, Google study finds. July 25.
  9. Brown SD (2016) Cryptocurrency and criminality: the Bitcoin opportunity. Police J 89(4):327–339CrossRefGoogle Scholar
  10. Chertoff M, Simon T (2015) The impact of the dark web on internet governance and cyber security, Global Commission on Internet Governance. In: Paper series n°6, the royal institute of International affairs. Waterloom Ontario : CIGI Chatham House, Ottawa, ON. 59p. Accessed 29 Apr 2019
  11. Corbet S, Lucey B, Urquhart A, Yarovaya L (2019) Cryptocurrencies as a financial asset: a systematic analysis. Int Rev Financ Anal 62:182–199CrossRefGoogle Scholar
  12. De Filippi P (2016) The interplay between decentralization and privacy: the case of blockchain technologies. J Peer Prod 7Google Scholar
  13. De Filippi P, Loveluck B (2016) The invisible politics of Bitcoin: governance crisis of a decentralized infrastructure. Internet Policy Rev 5:4Google Scholar
  14. De Vries A (2019) Renewable energy will not solve Bitcoin’s sustainability problem. Joule 3(4):893–898. CrossRefGoogle Scholar
  15. Dernbach JC, Brown DA (2009) The ethical responsibility to reduce energy consumption. Hofstra L Rev 37:985Google Scholar
  16. Dierksmeier C, Seele P (2018) Cryptocurrencies and business ethics. J Bus Ethics 152(1):1–14. CrossRefGoogle Scholar
  17. Dilek Ş, Furuncu Y (2019) Bitcoin mining and its environmental effects. Ataturk Univ J Econ & Adm Sci 33(1):91–106. Google Scholar
  18. Dopfer K, Foster J, Potts J (2004) Micro-meso-macro. J Evol Econ 14(3):263–279CrossRefGoogle Scholar
  19. Durrant S (2018) Understanding the nexus between cryptocurrencies and transnational crime operations. CUNY Academic Works, New York. Google Scholar
  20. Dyhrberg AH (2016) Bitcoin, gold and the dollar–A GARCH volatility analysis. Financ Res Lett 16:85–92CrossRefGoogle Scholar
  21. Ethereum 2.0 (Serenity) Phases. (2019). Accessed 14 May 2019
  22. European Central Bank (ECB) (2015) Virtual currency schemes – a further analysis. European Central Bank, Staff Working PaperGoogle Scholar
  23. Financial Action Task Force (FATF) (2015) Emerging terrorist financing risks. FATF, Paris.
  24. Foley S, Karlsen JR, Putniņš TJ (2019) Sex, drugs, and Bitcoin: how much illegal activity is financed through cryptocurrencies? Rev Financ Stud 32(5):1798–1853CrossRefGoogle Scholar
  25. Giungato P, Rana R, Tarabella A, Tricase C (2017) Current trends in sustainability of Bitcoins and related blockchain technology. Sustainability 9(12):2214CrossRefGoogle Scholar
  26. González PRV (2016) Superabundant design: from waste to control in Bitcoin mining. A peer-reviewed Journal About 5.1.
  27. Greenberg P, Bugden D (2019) Energy consumption boomtowns in the United States: community responses to a cryptocurrency boom. Energy Res Soc Sci 50:162–167. CrossRefGoogle Scholar
  28. Guesmi K, Saadi S, Abid I, Ftiti Z (2018) Portfolio diversification with virtual currency: evidence from Bitcoin. Int Rev Financ Anal 63:431–437. CrossRefGoogle Scholar
  29. Hayes A (2015a) A cost of production model for Bitcoin. Available via SSRN 2580904.
  30. Hayes A (2015b) The decision to produce altcoins: miners’ arbitrage in cryptocurrency markets. March 16, 2015. Available via SSRN 2580904.
  31. International Money Fund Staff Team (2016) Virtual currencies and beyond: initial considerations. IMF staff discussion Note. Accessed 30 Apr 2019
  32. Irwin ASM, Slay J, Raymond Choo KK, Lui L (2014) Money laundering and terrorism financing in virtual environments: a feasibility study. J Money Laund Control 17(1):50–75CrossRefGoogle Scholar
  33. Irwin ASM, Milad G (2016) The use of crypto-currencies in funding violent jihad. J Money Laund Control 19(4): 407–425CrossRefGoogle Scholar
  34. Kleineberg KK, Helbing D (2016) A “Social Bitcoin” could sustain a democratic digital world. Eur Phys J Spec Top 225(17–18):3231–3241CrossRefGoogle Scholar
  35. Krause MJ, Tolaymat T (2018) Quantification of energy and carbon costs for mining cryptocurrencies. Nat Sustain 1(11):711. CrossRefGoogle Scholar
  36. Krugman P (2013) Bitcoin is evil. Accessed 17 Apr 2019
  37. Lemieux P (2013) Who is Satoshi Nakamoto? Regulation 36(3):14–16. Academic One File, Accessed 9 May 2019Google Scholar
  38. Levin RB, O’Brien AA, Zuberi MM (2015) Real regulation of virtual currencies. In: Chuen DLK (ed) Handbook of digital currency. Elsevier, Academic Press, pp 327–360.
  39. Liao R, Russell J (2019) Regulators in China are weighing a ban on Bitcoin mining Dent Tech 9 April 2019
  40. Mas I, Chuen DLK (2015) Bitcoin-like protocols and innovations. In: Handbook of digital currency. Elsevier, Academic Press, pp 417–451.
  41. Maurer B, Nelms TC, Swartz L (2013) “When perhaps the real problem is money itself!” the practical materiality of Bitcoin. Soc Semiot 23(2):261–277. CrossRefGoogle Scholar
  42. Mora C, Rollins RL, Taladay K, Kantar MB, Chock MK, Shimada M, Franklin EC (2018) Bitcoin emissions alone could push global warming above 2° C. Nat Clim Chang 8(11):931. CrossRefGoogle Scholar
  43. Möser M, Böhme R, Breuker D (2013, September) An inquiry into money laundering tools in the Bitcoin ecosystem. In: 2013 APWG eCrime Researchers Summit. IEEE, pp 1–14.
  44. Nian LP, Chuen DLK (2015) Introduction to Bitcoin. In: Chuen DLK (ed) Handbook of digital currency. Elsevier, Academic Press, pp 5–30.
  45. Nica O, Piotrowska K, Schenk-Hoppé K R (2017) Cryptocurrencies: economic benefits and risks. University of Manchester, FinTech working paper, (2).
  46. O’Dwyer K J, Malone D (2014). Bitcoin mining and its energy footprint.” ISSC 2014/CHCT 2014, Limerick, June 26–27. 280–285, doi:
  47. Plassaras NA (2013) Regulating digital currencies: bringing Bitcoin within the reach of IMF. Chic J Int Law 14(1):377–407Google Scholar
  48. Prat J, Walter B (2018) An equilibrium model of the market for Bitcoin mining. CESifo Working Paper Series No. 6865.
  49. Santora M, Rashbaum WK, Perlroth N (2013) Online currency exchange accused of laundering $6 billion. New York Times, 28/05/2013 Accessed 26 Apr 2019
  50. Sovacool BK, Sidortsov RV, Jones BR (2013) Energy security, equality and justice. Routledge, London. CrossRefGoogle Scholar
  51. Tuwiner J (2019) Bitcoin mining in China., 28/01/2019. Accessed 18 Oct 2019
  52. Urquhart A, Zhang H (2018) Is Bitcoin a hedge or safe-haven for currencies? An intraday analysis An Intraday Analysis (January 31).
  53. Vigna P, Casey MJ (2015) The age of cryptocurrency: how Bitcoin and digital money are challenging the global economic order. St. Martin’s Press, New YorkGoogle Scholar
  54. Wimbush S (2018) Letter to nature. Nature, 22 March 2018, 555: 443Google Scholar

Copyright information

© Springer Nature Switzerland AG 2019

Authors and Affiliations

  1. 1.LITEM, Univ Evry, IMT-BSUniversité Paris SaclayEvryFrance

Personalised recommendations