Are Layer-1 Blockchains Becoming More Energy Efficient?

Cryptocurrencies are frequently blamed for harming the environment. According to the University of Cambridge's Bitcoin Electricity Consumption Index, the annual energy consumption of bitcoin mining exceeds that of Belgium. A 2019 research found that the annual CO2 emissions from Bitcoin mining was between 22 and 22.9 million metric tons.

In this article, we will explore the ways various crypto currencies are becoming carbon neutral.

The issue of climate change has been a deep struggle over the decade. These climate changes have been caused by the effect of the accumulation of greenhouse gases released into the atmosphere. As the Greenhouse Gases (GHG) continue to rise across the globe, particularly carbon emission, the great danger posed by these, becomes a global concern.

Issues Of Blockchain As Related To Carbon Efficiency.

One major issue facing Blockchain technology regarding carbon efficiency is the energy consumption required to mine most cryptocurrencies that use proof-of-work (PoW) as their mining algorithm.

Bitcoin, Bitcoin Cash, Litecoin, etc require lots of power usage and network hash rates to be able to mine them effectively.  Proof-of-work consensus algorithm works by needing miners to hash data or information that comes into every block.

As these major cryptocurrencies' network increases, it becomes increasingly difficult to mine with just a few nodes. The New York Times report stated that the Bitcoin network needs about 91 terawatts of electricity annually to mine it effectively, which is more than some of the electricity supply needed to power some countries.

Although there has not been any cut-off indication of the mining effect of PoW networks on the environment, there have been several major steps taken toward ensuring that blockchain cryptocurrencies and platforms are more energy efficient and environmentally friendly.

How Different Blockchains Are Striving For  Carbon-Efficiency.

The Crypto Climate Accord was unveiled in April of last year. According to the alliance, the goal of this "private sector-led project for the whole crypto community." Its aim is to "achieve net-zero emissions for the whole crypto sector" by the year 2040, by "decarbonizing the cryptocurrency and blockchain business in record time". According to a Cambridge University research, more than 75% of all Bitcoin miners currently in operation use renewable energy to run their daily operations.

Several crypto currencies are taking huge steps to improve their carbon efficiency for example:

1. Ethereum

One of the most exciting news in the blockchain space in 2022 was the ETH Merge – a transition from the Proof of Work (PoW) consensus to the Proof of Stake (PoS) consensus mechanism. Unlike the PoW, Proof-of -stake employs the use of validators who stake a certain amount of their cryptocurrency, which is being locked up and can't be touched, whilst working with other validators to verify a block for some incentives.

The ETH Merge got rid of energy-consuming nodes and computers used to mine ETH for participation. This way, the Ethereum network takes out the need for intensive energy mining whilst still keeping the network secure and reliable. Bitcoin isn't left out, as renewable energy is being developed for its mining activities. With approximately 60% of renewable energy being achieved currently, the future of Blockchain in curbing carbon emissions seems bright.

With this Merge, which took place on the 15th of September, 2022, Ethereum finally achieved being a greener Blockchain as its electricity footprint dropped exponentially from about 8.5GW to less than 85MW and the energy consumed will be around 0.01 TWh/yr.

Bitcoin may not be able to go green, but for the second largest blockchain, Ethereum to make amendments to its structure and aim for lesser energy consumption, that is great progress made and the industry can boast of being more carbon-efficient than it was last year.

2. Tron

Tron is a blockchain dedicated to reducing carbon footprints in the industry, thus making the chain one of the first chains to be a strong advocate for carbon efficiency.

Tron is reputedly rallied to consume 99.9% less of the energy consumed by Bitcoin and Ethereum (before the Merge). Last year, it consumed only 162,868 kWh of energy for over 2.31 billion transactions. So, its energy consumption is comparable to that of 15 average US homes. Now, that says a lot about this chain.

3. Cardano

If Tron is doing great, Cardano is doing excellently when it comes to dispelling carbon footprints. Cardano was birthed with a mission in mind, "carbon efficiency".

Cardano is one of the largest PoS blockchains in the industry with around 3,000 staking pools, yet it consumes about 0.5479 kWh/hr. Its whole network consumes about 0.00277429 TWh/yr compared to that of Bitcoin, which is 131.0 TWh/yr.

4. Polygon

Although Polygon is an Ethereum-scaling Blockchain, the chain uses the PoS mechanism. However, before the Merge, it didn't put out the carbon footprints left by Polygon.

In April, Polygon took it upon itself to stay carbon neutral by permanently removing $400,000 of carbon credits to offset 104,794 tonnes of carbon and greenhouse gases emitted since the launch of its chain.

Thereafter, Polygon made sure that every transaction in the chain – minting, trading, etc, is accounted for and their carbon footprint is offset.

5. Solana

To stay carbon neutral, Solana built the Solana Foundation – a protocol built to study the energy consumption and impact of the Solana chain and provides ways to offset all impact and footprints to zero.

The Foundation provides the Solana community with resources and tools to help reduce their carbon emissions and purchase annual offsets to wipe the blockchain's footprint.

6. Aptos:

The Aptos blockchain is Layer 1 blockchain with security, speed, and scalability as its core features. The Aptos blockchain uses a proof-of-stake (PoS) consensus method and is supported by a community of validators that handle transactions and keep the infrastructure up to date. The PoS consensus makes Aptos a darling of environmentalist and node providers and launched in March 2022, the Aptos developer testnet had the largest ever proof-of-stake node ecosystem  as it peaked at 18,000 fully active nodes.

Pontem and Aptos are now collaborating to develop the fundamental dApps for their expanding ecosystem. These solutions will accelerate the mainstreaming of Aptos, including Liquidswap Automated Market Maker (AMM), Move Code Playground, Pontem VM, and more.

For more updates, visit pontem.network