Crypto holdings in your carbon footprint: the hybrid method and whether you must report

In short

No UK rule makes a company report the carbon footprint of crypto it holds, but it can choose to. The most cited method, the hybrid method from South Pole and the Crypto Carbon Ratings Institute (2022), gives a holder its share of bitcoin's yearly emissions by the share of coins it holds: about 2.0 to 5.6 tonnes CO2e for each bitcoin held for a year on today's estimates (30 October 2026), reported in Scope 3.

Updated 30 October 2026 by the Carbon Recycling team. Rules and methods checked on 30 October 2026; figures from the Cambridge Centre for Alternative Finance, Digiconomist and the Bitcoin blockchain.

Why holding bitcoin can carry a footprint

A company that buys bitcoin and keeps it uses no electricity itself. But bitcoin's miners are paid mostly in newly created coins, and those coins are worth mining only because people buy and hold them. Over the last year, 99.4% of miners' income was new coins and 0.63% was transaction fees, from the block rewards on the Bitcoin blockchain. So holders, not payments, are what keep most of the machines running. That is the argument for giving holders a share of the network's emissions, in the same way an investor counts a share of the emissions of a company it owns.

The hybrid method

In April 2022 the climate consultancy South Pole and the Crypto Carbon Ratings Institute (CCRI) published "Accounting for Cryptocurrency Climate Impacts". It looked at giving the network's emissions to holders only, or to transactions only, and proposed a mix of the two:

Your emissions = network emissions × (X × your holdings ÷ value of all coins + Y × fees you paid ÷ all fees paid)

X is the share of miners' income from new coins and Y the share from fees. The 2022 framework used X = 94% and Y = 6% for bitcoin; over the last year the blockchain gives X = 99.4% and Y = 0.63%, because fees have fallen. For bitcoin, your share of the value of all coins is simply your coins divided by the 20,105,594 in existence, so the price does not matter.

Each bitcoin held for a full year comes to 1.97 tonnes CO2e on the Cambridge Centre for Alternative Finance's estimate of the network (39.8 MtCO2e a year, April 2025) and 5.64 tonnes on Digiconomist's (114.03 Mt CO2, read 30 October 2026). The crypto carbon calculator works it out for any amount and period.

Worked example

A company held 10 BTC for the first six months of its financial year and 30 BTC for the second six, an average of 20 BTC, and made 24 payments in bitcoin.

Holdings: 20 BTC × the yearly figure per bitcoin = 39.3 to 112.7 t CO2e
Payments: 24 transactions × the fee share per transaction = 29 to 83 kg CO2e, assuming average fees

The holdings come to more than a thousand times the payments, which is why the method matters: a figure built only on transactions would miss almost all of it.

Do you have to report it?

SECR (UK companies and LLPs in scope): no. SECR asks for UK energy use and Scope 1 and 2 emissions; Scope 3 is voluntary. If you mine, your mining electricity is ordinary Scope 2 and does count.
Carbon Reduction Plans (PPN 006): no. A plan must cover Scope 1, 2 and Scope 3 categories 4, 5, 6, 7 and 9, which do not include investments.
UK SRS S2 and IFRS S2: these ask for Scope 3, and for asset managers, banks and insurers, financed emissions. They do not mention crypto assets, so whether holdings belong in a company's Scope 3 is a judgement about what is material. UK SRS is voluntary for now; read our UK SRS guide for who will report and when.
MiCA (EU crypto firms): yes for them, in a different form. Article 66(5) of MiCA makes crypto-asset service providers publish the climate and environmental impacts of the consensus mechanism behind each coin they deal in. Delegated Regulation (EU) 2025/422 sets the format: every provider publishes each coin's energy use, and providers running a trading platform or exchanging crypto must also publish greenhouse gas figures where the network's yearly energy use is over 500,000 kWh, which bitcoin's always is.

How to report it

Take the average balance of each coin over the year from your wallet or exchange statements (month-end balances are enough).
Multiply by the yearly figure per coin, from one stated estimate of the network. Use the same estimate every year, or restate if you change.
Add transactions only if you pay or receive in crypto often; for most holders they are tiny.
Report the total as a separate Scope 3 line, outside your Scope 1 and 2, with a note: the method (hybrid, South Pole and CCRI 2022), the estimate and its date, and the category you chose.
Do not net it off against anything, and do not call it "offset" unless you have bought and retired credits for it.

How Carbon Recycling helps

Carbon Recycling works out the rest of your footprint, Scope 1, 2 and 3, from your bills, mileage, travel and spending with the UK government factors, with the method behind every line. Crypto is not in the government factors, so use the free calculator for the holdings figure and report it with its method alongside.

Frequently asked questions

Do UK companies have to report the carbon footprint of bitcoin they hold?

No UK rule requires it today. SECR asks for energy use and Scope 1 and 2 emissions, and holding coins uses no energy on your premises. Scope 3 is voluntary under SECR, and a PPN 006 Carbon Reduction Plan asks for five Scope 3 categories that do not include investments. A company may choose to report it, and an investor or lender may ask.

What if my company mines crypto?

Then the electricity your machines use is your own Scope 2 (or Scope 1 if you generate it on site), like any other electricity, and counts in SECR if you are in scope. That is reported from your meter readings with the normal grid factor, not from a network estimate.

Which Scope 3 category do crypto holdings go in?

The GHG Protocol has not said. South Pole and the Crypto Carbon Ratings Institute suggest category 15 (investments) is the likeliest fit for holdings, and note some treat buying coins as a purchased service (category 1). Pick one, say which and why, and keep it the same each year.

Is the hybrid method the official way to do it?

No official method exists. The hybrid method was proposed in 2022 by South Pole, a climate consultancy, and the Crypto Carbon Ratings Institute, and is the most widely cited. It splits the network's emissions between holders and transactions by how miners are paid.

Does this apply to crypto held for customers?

The South Pole and CCRI framework notes that entities with operational control over an asset, such as crypto asset owners and service providers, may be responsible for their share. In the EU, crypto service providers already publish each coin's energy use under MiCA. In the UK there is no equivalent rule yet.

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