Cryptocurrency energy consumption is an endless debate. Most cryptocurrencies such as Bitcoin and Ethereum consume large amounts of energy. The truth is that these cryptocurrencies need energy-efficient ways of mining the coins because the Proof of Work (PoW) method is not. This narrows down to any available PoW energy-efficient blockchain technology.
What is PoW?
Proof of Work is a traditional mining method that follows Satoshi’s order. Satoshi followed the blockchain mechanisms where Bitcoin pays miners with every block of transaction confirmed. PoW algorithms directly affect energy usage because miners need to sell the coins to pay their bills.
The algorithm also adds new blocks to the chain for data storage, something that requires more energy. Proof of work technology consumes a lot of energy, which makes Bitcoin a risk to the environment. A report in 2020 shows that mining Bitcoin consumes power equal to that of 159 countries combined. Elon even tweeted in May that Tesla would no longer accept Bitcoin as a form of payment because it risks the environment.
Many scientists and researchers argue that it is impossible to attain a PoW energy-efficient blockchain technology. Scientists say cryptocurrencies can use PoS as an alternative because it is a much more energy-efficient process. However, with technology, everything and anything is possible; the limit is our imagination.
Advances in scalability allow for advancements in PoW technology. The new technology provides energy-efficient mining solutions. Even though the technology is not entirely accurate, it helps reduce energy consumption. The technology will make PoW environmentally friendly, that is, greener and more secure.
Factors that affect PoW energy efficiency are the number of Transactions per Second (TPS). The new technology, yet to receive confirmation, will also allow for a maximum of 100 000 TPS. This will reduce energy consumption considerably.
Green Proof of Work Suggestions
Green PoW suggestions trying to reduce PoW energy consumption are very few. The only available one is Kadena, a shared layer-1 version of the PoW blockchain, which is faster and scalable. Kadena’s is a public blockchain that slows for a network expansion of 10-20 chains. The technology doubles throughput by providing an ability to scale production and meet the high demands.
Kadena allows connectivity to the public blockchain through its high-performance network, handling demanding use case requirements. This achievement is because the network enables the use of a custom-service architecture. The network also provides private and public benefits to all users without compromise, whether enterprises or independent entrepreneurs. Some of the cryptocurrencies Kadena helped to enhance include Polkadot, Chainlink, and Bittrex.
Future of PoW Energy-Efficient Technology
Using green suggestions of PoW to make blockchains that use pow, such as Bitcoin, more scalable, will help reduce energy consumptions. Kadena is one of these examples. However, the cryptocurrencies with a partial deployment like Ethereum should consider Proof of Work alternatives like PoS, which uses many processors to make mining safe. Cryptocurrency is indeed the future but the safety is also very critical.