The use of green blockchain will have a massive impact on the electricity consumption for mining!
Sustainability is increasingly becoming a central criterion for the future of the blockchain industry. Achieving a cryptographic mechanism that is not only effective but also efficient is essential to expand the use of blockchain-based cryptocurrencies further. To analyze the energy efficiency of a particular cryptocurrency, it is necessary to inspect its process of creating and maintaining blocks of information: how the users of that currency have agreed to record and validate the information contained in each block of the distributed database. This article talks about green blockchain and why India needs it.
Almost all of the most popular cryptocurrencies – such as Bitcoin, the original cryptocurrency created in 2009 – are produced through mining. This is precisely the process that the new green cryptocurrencies want to rethink in order to reduce their unnecessary energy consumption. An inefficient energy expenditure, with its associated greenhouse gas emissions, opposed to the founding purpose of digital currencies to create a more accessible, fair, and sustainable system than traditional government-controlled currencies.
The Ethereum Merge
The current Merge — where the Ethereum community formally converted to a less-energy-consuming proof-of-stake (PoS) mannequin from a proof-of-work (PoW) mechanism — has introduced ‘green’ blockchain or sustainable blockchains beneath the highlight. This comes at a time when cryptocurrencies are dealing with flak throughout the globe over their power-intensive mining process, having already seen a strict mining ban in international locations like China and Kosovo on account of rising electrical energy prices. As India is trying to faucet into the digital coin area with its very personal central financial institution digital forex (CBDC), and since crypto buying and selling is seeing an increase within the nation, it’s solely apt that the Centre considers facilitating inexperienced blockchain endeavors to help a sustainable development within the crypto business.
On that note, let’s talk about green blockchain. A blockchain is a digital ledger that keeps a log of all transactions done on a network. If we put it simply, cryptocurrencies exist only on a blockchain and it helps track all transactions related to a coin in a decentralized manner (not controlled by a single entity).
Countries like China and Kosovo have already enforced a ban on crypto mining just to get rid of the spike in their electricity consumption. In India so far, crypto mining is still unregulated. So, you can still mine crypto coins in the country, but the overall proof-of-work mining model is hampering power distribution in a nation that is not only heavily dependent on fossil fuels but where electricity shortage is a major concern for those living away from urban regions.
A green blockchain comes in as a sustainable alternative. As mentioned earlier, the Ethereum network has switched to a proof-of-stake mechanism. In the case of PoS, processing doesn’t use up much energy, transactions are comparatively cheaper, and importantly, it is safe from a major attack on the network.
To put things into perspective, a PoS mechanism consumes 99.9% less energy than a PoW model.
Why is it Important in India?
Since much less vitality is consumed, a green blockchain has a notably small carbon footprint. Poorvi Sachar, Head of Operations, Tezos India, instructed ABP Stay, “In a country like India whose primary source of energy is fossil fuels, the use of ‘green’ blockchain technology would have a massive impact on the electricity consumption for mining/baking. It would lead to a much cleaner and greener environment, leaving fewer carbon footprints.”
If we have a look at the numbers, mining a single token of Bitcoin can eat as much as 2,165kWh of electrical energy in conventional strategies. As per an examination by the Council of Vitality, Setting and Water (CEEW), a typical Indian family consumes about 5.7kWh of energy each day. So, the facility taken to mint a single Bitcoin through conventional strategies might be sufficient to energy a family for over 12 months — 380 days to be precise.