ESG

The cryptocurrency industry faces growing concerns about high energy consumption levels in traditional blockchains and the social dimension, which should include consumer protection, financial inclusion, human rights, and diversity. Additionally, in diversified governance, a system is needed to prove illicit actions of bad agents or manipulation. We contend that these ESG impacts are negative externalities due to the misalignment of incentives on a typical blockchain network.

However, literature on sustainability has significant limitations. Various data providers offer ESG measurements, but little correlation between them. Consequently, there is considerable debate over how to quantify ESG, and numerous factors must be weighted to create a composite metric.

As proposed, when certain events occur on the Cascadia blockchain, predefined processes ensure that associated transactions are automatically triggered. Since human oversight will not be necessary in the later stages of development, fewer errors occur, and the accuracy of the data and transactions conducted is confirmed. A fully developed cybernetic control system introduces autonomy and trust in an industry that is sorely lacking these standards.

Cascadia’s control system may also be used in an ESG use case to automatically publish data to the public and/or regulators in real time or on a predetermined schedule—all without human interaction. Regulators and third parties can independently verify this data to ensure that the blockchain's operations adhere to predetermined criteria and that its messaging and claims are accurate. This allows Cascadia to prove its ESG position, and engage in public discourse.

The nature of social impact is not just about risk, but also prosocial behavior. Outcome-based standards measure the extent of social change that certain strategies will have within Cascadia’s network. Control systems self-select outcomes to be reported. Users can therefore conduct more comprehensive social impact analyses using this information, and the system will publicize that data.