CRYPTOCURRENCY UPDATES: A REVAMP OF ETHEREUM COULD REDUCE EMISSIONS BY 99%.

A REVAMP OF ETHEREUM COULD REDUCE EMISSIONS
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A REVAMP OF ETHEREUM COULD REDUCE EMISSIONS BY 99%, HAVE AN IMPACT ON THE ENVIRONMENT.

A REVAMP OF ETHEREUM COULD REDUCE EMISSIONS BY 99% IN DETAIL:

THE ENERGY-INTENSIVE NATURE OF CRYPTOCURRENCY MINING HAS LONG BEEN CRITICIZED. NATURE CLIMATE CHANGE ISSUED A WARNING ABOUT BITCOIN MINING 4 YEARS AGO, STATING THAT IF ADOPTION RATES FOR OTHER WIDELY ADOPTED TECHNOLOGIES WERE TO MATCH THOSE FOR BITCOIN MINING, IT MIGHT TAKE JUST 14 YEARS FOR GLOBAL WARMING TO REACH THE CATASTROPHIC 2OC THRESHOLD. 

A REVAMP OF ETHEREUM COULD REDUCE EMISSIONS
A REVAMP OF ETHEREUM COULD REDUCE EMISSIONS BY 99%.

ETHEREUM, THE SECOND-LARGEST CRYPTOCURRENCY IN THE WORLD, IS ABOUT TO UNDERGO A RADICAL TECHNOLOGICAL CHANGE THAT HAS THE POTENTIAL TO DRASTICALLY REDUCE ITS CARBON FOOTPRINT BY 99%. IN FAVOR OF A NEW MODEL CALLED “PROOF OF STAKE,” ETHEREUM IS ABANDONING THE “PROOF OF LABOR” MODEL THAT IS USED IN THE MINING PROCESS OF THE MAJORITY OF CRYPTOCURRENCIES, INCLUDING BITCOIN.

THE ETHEREUM WORKFORCE DESCRIBES THE NOVEL MAKEOVER IN THESE WORDS:

AFTER THE MERGE, ETHEREUM’S CONSENSUS ALGORITHM WILL BE PROOF-OF-STAKE (POS). PROOF-OF-STAKE IS REPLACING PROOF-OF-WORK (POW) IN ETHEREUM BECAUSE IT IS SAFER, USES LESS ENERGY, AND IS BETTER FOR IMPLEMENTING NEW SCALING OPTIONS. ALTHOUGH MOVING TO PROOF-OF-STAKE HAS ALWAYS BEEN THE GOAL, THE MECHANISM HAS UNDERGONE EXTENSIVE RESEARCH AND DEVELOPMENT OVER THE YEARS AND IS MORE ADVANCED THAN PROOF-OF-WORK. NOW, THE CHALLENGE IS TO INTRODUCE PROOF-OF-STAKE ON THE ETHEREUM MAINNET. THIS PROGRAM IS REFERRED TO AS “THE MERGE.”

TO UNDERSTAND WHAT THE ETHEREUM CAMP IS TALKING ABOUT, LET’S LOOK AT THE CRYPTO MINING PROCESS.

101 OF CRYPTO MINING:

CRITICS WHO COMPLAIN ABOUT THE ALLEGEDLY ENORMOUS AMOUNTS OF POWER USED BY CRYPTO MINING AND HOW IT CONTRIBUTES TO CLIMATE CHANGE ARE SEEN BY SOME CRYPTO ENTHUSIASTS AS LITTLE MORE THAN CHURLISH, PEDANTIC PARTY POOPERS. 

THE POW (PROOF-OF-WORK) MAXIMALISTS, WHO DISAGREE THAT BITCOIN IS A POWER HOG, CLAIM THAT BITCOIN AND ETHEREUM ARE THE “MOST SAFE PUBLIC CHAINS” BASED ON HASHRATE.

CRYPTO APOLOGISTS (SUCH AS COINSHARE) IN THE OPPOSING CAMP ACKNOWLEDGE THAT CRYPTO MINING IS UNDOUBTEDLY A POWER-HUNGRY PROCESS, BUT THEY IMMEDIATELY GO ON THE DEFENSIVE BY ASSERTING THAT MUCH OF THE POWER COMES FROM RENEWABLE SOURCES.

THE AMOUNT OF ELECTRICAL ENERGY MINERS USE TO TRY TO SOLVE THESE MYSTERIOUS COMPUTATIONAL PUZZLES IS WHAT DETERMINES HOW MUCH OF A CARBON FOOTPRINT CRYPTOCURRENCY MINING HAS. 

THE BAD NEWS IS THAT OVER THE PAST FEW YEARS, BOTH BITCOIN AND ETHEREUM HASH RATES HAVE INCREASED DRAMATICALLY, WITH THE BITCOIN COMMUNITY NOW CLAIMING 218.66M TH/S WHILE ETHEREUM’S IS LOWER AT 918.79 TH/S.

SINCE THEY RELY ON HEAVY RESOURCE CONSUMPTION TO DEFEND THEIR NETWORKS FROM MALICIOUS ATTACKERS, THE MOST SECURE CRYPTOGRAPHIC NETWORKS, LIKE BITCOIN AND ETHEREUM, ARE ALSO BY NECESSITY THE MOST POWER-INTENSIVE. BITCOIN AND OTHER POW TASKS RELY ON MINING TO SECURE THEIR BLOCKCHAINS, AND EVEN AFTER EACH COIN HAS BEEN MINED, HASHING OPERATIONS MUST CONTINUE. NETWORKS WITH LOWER RESOURCE REQUIREMENTS DON’T EMPLOY THESE EXACTING PROCEDURES, MAKING THEM SIGNIFICANTLY LESS SECURE.

THE POW CLASS OF COINS INCLUDES THOSE THAT ARE MINEABLE, AND COINMARKETCAP LISTS SEVERAL TONS OF THIS CLASS. AS FAR AS POWER CONSUMPTION IS CONCERNED, THESE ARE THE MAIN OFFENDERS. AS OPPOSED TO THEIR POW BRETHREN, NON-MINEABLE CURRENCIES LIKE RIPPLE, EOS, STELLAR, TEZOS, NEO, AND NEM USE LESS ENERGY TO VALIDATE TRANSACTIONS AND PROTECT THE COMMUNITY. 

THE MILLION-DOLLAR QUESTION IS HOW MUCH POWER BITCOIN AND ETHEREUM MINING CONSUMES FROM OUR ENERGY GRIDS EACH YEAR.

DEPENDING ON WHO YOU ASK, THE INFORMATION AVAILABLE VARIES SOMEWHAT AND IS, QUITE FRANKLY, AVAILABLE EVERYWHERE.

TO CALCULATE ENERGY CONSUMPTION, DIGICONOMIST USES THE PORTION OF MINING PROFITS THAT GO TOWARD ELECTRICAL ENERGY COSTS. USING THIS METHOD, THE TEAM CALCULATES THAT BITCOIN MINING USES 128.61 TWH ANNUALLY, OR ABOUT THE SAME AMOUNT OF ENERGY AS THE ARGENTINA, UNITED ARAB EMIRATES, NORWAY, SWEDEN, AND UKRAINE COMBINED. ACCORDING TO THE CAMBRIDGE BITCOIN ELECTRICITY CONSUMPTION INDEX, THE ANNUAL ENERGY CONSUMPTION OF BITCOIN IS ESTIMATED TO BE 10.76 GW, OR 94.26 TWH. TO PUT THINGS IN PERSPECTIVE, THE ANNUAL GLOBAL CONSUMPTION OF ELECTRICAL ENERGY IS 23,800 TWH.

ODDLY, ETHEREUM’S ENERGY USAGE IS ESTIMATED BY DIGICONOMIST TO BE 79.79 TWH PER YEAR, WHICH IS NOT DISSIMILAR TO BITCOIN’S. ALSO WORTH MENTIONING IS THE NEARLY 10-FOLD INCREASE IN ENERGY CONSUMPTION FOR ETHEREUM OVER THE PREVIOUS FIVE YEARS.

BY ANALYZING THEIR HASH RATES AND MAKING ASSUMPTIONS ABOUT THE TYPES OF MINING RIGS USED AND THEIR RESPECTIVE EFFICIENCIES, IT IS POSSIBLE TO ESTIMATE THE POWER CONSUMPTION OF VARIOUS ALTCOINS. 

THESE NUMBERS COULD, HOWEVER, BE WILDLY OFF. IT MAKES SENSE, ACCORDING TO SOME VERY DIFFICULT BACK-OF-THE-NAPKIN MATH, TO ASSUME THAT ROUGHLY 60% OF THE MINING POWER USED FOR CRYPTOCURRENCIES IS SPLIT BETWEEN BITCOIN, ETHEREUM, AND OTHER CRYPTOCURRENCIES. THAT COULD PUT THE TOTAL POWER USED FOR CRYPTOCURRENCY MINING AT 350 TWH PER YEAR, OR 1.5% OF THE TOTAL AMOUNT OF ELECTRICITY USED GLOBALLY. THE PRECISE NUMBER IS CLOSER TO 30%, CONTRARY TO COINSHARE’S AUDACIOUS CLAIM THAT THE BITCOIN COMMUNITY OBTAINS NEARLY 75% OF ITS ENERGY FROM RENEWABLE SOURCES.

CONCLUSION A REVAMP OF ETHEREUM COULD REDUCE EMISSIONS BY 99%:

TO CONCLUDE, A REVAMP OF ETHEREUM COULD REDUCE EMISSIONS BY 99%. THE BITCOIN AND CRYPTOCURRENCY MINING ARE UNDOUBTEDLY PLAYING A SIGNIFICANT ROLE IN GLOBAL WARMING, SO ETHEREUM’S SWITCH TO A PROOF-OF-STAKE (POS) MODEL THAT USES ONLY 1% OF THE ENERGY USED BY THE POW MODEL MAKES A LOT OF SENSE. A LOT OF PRESSURE WILL LIKELY BE PLACED ON BITCOIN AND OTHER CRYPTOCURRENCIES TO FOLLOW SUIT. WITHOUT A DOUBT, THIS STRESS HAS ALREADY STARTED: LAST YEAR, TESLA FOUNDER ELON MUSK DECLARED HIS COMPANY WOULD NOT ACCEPT BITCOIN AS PAYMENT FOR ITS ELECTRIC VEHICLES DUE TO THE CRYPTOCURRENCY’S SIGNIFICANT CARBON FOOTPRINT.

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CRYPTOCURRENCY UPDATES: A REVAMP OF ETHEREUM COULD REDUCE EMISSIONS BY 99%.

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