The fascinating world of cryptocurrencies has changed our history. It has already revolutionized global economy, energy industry, and even entertainment. One of the crypto innovations in entertainment led to the crypto online casino real money platforms. Digital gold has taken us by storm, unlike any other trends in history. From its introduction to the public up to today, cryptocurrencies have endured highs and lows, but are still in trend. And it is not just about trends: cryptocurrencies significantly improve many business processes. However, the process of generating new bitcoins (crypto mining) is an energy-intensive process. It leads to significant carbon emissions, electronic waste and hurts the natural environment.
As the Bitcoin moves more into the mainstream, crypto enthusiasts think about how to reduce energy consumption. This is very important for minimizing the carbon footprint associated with digital money. Before diving into green mining, let’s understand more about what green mining is. The answer has to do with the current way in which Bitcoins transactions are verified and new coins in existing blockchain are minted. This article discusses some of the modern solutions for ecologically balanced crypto space.
Energy Usage And Green Cryptocurrencies
Each cryptocurrency (Bitcoin, Ethereum, Litecoin, Dogecoin, etc.) may be characterized by energy efficiency. It is about the amount of electrical and computational energy needed to create new blocks of information in the blockchain. To verify and record new transactions computers also require energy. Moreover, people need these computers to solve complex mathematical problems. As of 2023, the Bitcoin industry alone has an annual electricity consumption of more than 200 terawatt-hours (TWh). And it produces over 90 million tonnes of CO2 per year. In most cases, electrical power for mining comes from non-renewable energy sources (fossil fuels). Burning of fossil fuels drives climate change.
In contrast, green cryptocurrencies are produced with lower energy consumption. Mining them, also called “green” mining uses renewable energy sources and nuclear power. Renewable energy sources are hydroelectric power, solar power, wind power, tidal power and they emit no carbon. Nuclear power emits less carbon than fossil fuels. One of the eco-friendly mining companies is a Houston-based Lancium. The company builds bitcoin mines that take power only from renewable energy sources. Lancium also develops other sustainable bitcoin solutions. One of the pioneers in this area is London-based cryptocurrency miner Argo Blockchain. It builds mines in Texas and Quebec on renewable energy. Well-known green miners are Hive Blockchain Technologies, Marathon Digital Holdings, and Bitfarms. The “greenest” cryptocurrencies are Cardano, Nano, SolarCoin, Algorand, Stellar Lumens, and Chia. They focus on minimization of energy usage and amount of computing power for mining.
Making Blockchain More Sustainable
To make mining energy-efficient businesses optimize the blockchain structure. They also work on reducing the number of energy-intensive mining activities. To do that, they break the blockchain into smaller pieces and use energy-efficient mining mechanisms. This is how the blockchain platform Energy Web Chain for the energy sector works. Other real-life approaches to make blockchain sustainable are Hedera Hashgraph and Chia Network.
Hedera Hashgraph is more environmentally friendly than platforms with traditional blockchains. Hedera uses the directed acyclic graph. These modifications make mining bitcoins and recording transactions easier and scalable. Therefore, it reduces the computational power and energy consumption. Another solution is to use a more energy-efficient way of verifying transactions. The more advanced system is called the proof-of-stake consensus mechanism.
A global game-changer itself, cryptocurrency is a big challenge for our environment. It leads to vast amounts of energy consumption and drives climate change. To prevent it, many companies try to make cryptocurrencies more sustainable. They fundamentally change the process of mining crypto. To do that they adopt different green blockchain solutions. They switch to renewable energy, use energy-efficient verification mechanisms, and optimize blockchain. As of 2023, there is still work to do on the way to a sustainable future and more responsible energy use. Anyway, sustainable crypto is very important for us. It will undoubtedly shape the future of our digital world.