Towards a greener future: The role of blockchain legislation in promoting corporate green innovation

In this study, we examine how blockchain adoption impacts the production of green technologies using the staggered implementation of blockchain-friendly laws in the United States as quasi-exogenous shocks. Our analysis shows that the enactment of blockchain-friendly legislation leads to a significant increase in green innovation. We establish that pro-blockchain legislation promotes green innovation through the information, financing, and external governance channels. Additional analysis reveals that the effect of blockchain adoption on green technologies is particularly pronounced for firms that face severe climate risks and have ESG-linked pay policies. We also find that blockchain-friendly laws are associated with a decline in corporate toxic emissions, a reduction in environmental litigation costs, an increase in green R&D and an improvement in market advantage. These findings underscore the importance of cutting-edge technologies in the green industrial revolution toward a low carbon economy.