Environmental Cryptocurrency Concerns
Environmental cryptocurrency consciousness is developing as more and more people think about the impact of crypto on our ecology. It has been widely reported that Bitcoin, altcoins like DOGE, and other cryptocurrencies are having a detrimental impact on the environment.
How much do you know about environmental cryptocurrency concerns? Are you aware that the high levels of energy consumption in the crypto space could pose a threat to our planet?
We have to start thinking about environmental cryptocurrency, for the protection of our ecology and the wider adoption of crypto.
Cryptocurrencies generated through mining have a substantial negative impact on the environment. They use high-powered computers and a massive amount of electricity to mine their coins. What is the effect of this high level of energy consumption on the environment?
Cryptocurrency has become extremely popular. There are thousands of coins, with new ones emerging all the time. While this may be good for the crypto space and investors, there is a downside - especially if those cryptocurrencies require mining.
Bitcoin, the most popular cryptocurrency, is viewed as an unsustainable network. Bitcoin requires a high level of energy consumption for mining, and the more Bitcoin that gets mined, the more harm it causes to the environment.
In the past, there wasn't much time given to environmental cryptocurrency thinking. However, awareness of the negative impact of unsustainable cryptocurrencies on the environment is growing, along with demands for solutions.
Let us go through the impact of cryptocurrency mining on the environment
How are Cryptocurrencies Made?
Many cryptocurrencies are created through 'mining'. Miners use computer programmes and power to create solutions to tough problems. The answers they create validate cryptocurrency transactions, and this validation goes into a decentralized record-keeping system. Powerful computers used for mining are called mining rigs, which use a surprisingly high amount of electricity.
For example, researchers from Cambridge University estimated that Bitcoin annually uses electricity more than the whole of Argentina.
Digiconomist, a cryptocurrency analytics site, published that the carbon footprint of one Bitcoin transaction is likely to be more than two million Visa transactions. And just that transaction uses as much power as an average American household uses in two months.
This danger that digital currencies pose to the environment starts to make sense now.
The use of cryptocurrencies to make transactions have increased speedily. Is there any hope for our environment?
Can this Impact be Controlled?
Many cryptocurrencies are created through Proof of Work, which leads to large energy consumption. However, other methods that require less energy are being developed:
Proof of Stake (PoS): a cryptocurrency consensus mechanism for processing transactions and creating new blocks in a blockchain. This mechanism is an alternative to cryptocurrency mining that does not involve extensive computing power. Paying closer attention to this method will help to conserve more energy consumed while mining cryptocurrency. Ethereum plans to move from PoW to a PoS algorithm. It will reduce the network's energy demand by about 99%.
Some Bitcoin developers are working towards the Lighting Network that will decrease the energy consumption by most transactions.
Cryptocurrency education is also necessary; people must become fully aware of environmental cryptocurrency challenges. Bitcoin uses the most energy when it comes to mining. Yet, when people get introduced to cryptocurrency, many start with Bitcoin and use it the most.
People can be educated about other options they have in cryptocurrency. They can learn to use more environmentally friendly cryptocurrencies that don't use PoW.
Environmental cryptocurrency consciousness is a good thing. This is a serious issue. It needs to be tackled now, before it worsens.
Author: Brendan Beeken
Moni Talks Founder and Chairman Brendan Beeken is an entrepreneur, commercial strategist, investor, and philanthropist. He writes on a wide range of subjects, including cryptocurrency, decentralised finance, blockchain, business advice, and professional wellbeing, for news and business websites, as well as Latest Moni and his personal site, brendanbeeken.com. Brendan draws from his own research and more than two decades of personal experience in business to offer a unique insight, perspective, and commentary on diverse subjects. He is passionate about making the cryptocurrency space more accessible and encouraging safer and more responsible trading and investing. Brendan's LinkTree is https://linktr.ee/brendanbeeken.