Whether the advantages of technological advancement outweigh their effects on the environment were one of the most pressing ones humanity had ever confronted, even at the beginning of the Industrial Revolution.
As humanity has become increasingly reliant on its most cutting-edge technologies, this problem has ultimately defined our time. The world we lived in then was revolutionized by electricity and fossil fuels, whereas today, in less than two decades, interconnection has permanently altered how we think and act.
What exactly is Blockchain?
Blockchain technology is one of the most divisive innovations to emerge from the Digital Revolution. With too much attention being paid to mining cryptocurrencies rather than just using them for more beneficial uses, its tremendous potential still needs to be realized.
Blockchain is now the villain in the never-ending conflict between technology and the environment due to the enormous energy needed to power mining. But some great brains have also come up with intriguing and curious ways to employ this technology for a better planet. In this post, we’ll examine some of the advantages and disadvantages of blockchain technology and its effects on the environment.
Blockchain technology is a network of connected computer systems that houses a distributed digital ledger of all transactional operations. The term ‘block’ refers to each transaction’s unique record, while the term ‘chain’ refers to how those records are connected as a single chain. Every participant’s ledger receives a copy of every transaction that takes place. As a result, security, effectiveness, and transparency are all possible.
So, is Blockchain Environment-Baddie or Environment-friendly?
We must first comprehend how new coins are created in a cryptocurrency to comprehend how the blockchain affects the Environment. The blockchain depends on people to validate transactional operations and add new data blocks since cryptocurrencies aren’t subject to centralized regulation. These blockchains must be extremely challenging and expensive to validate and defend against malicious actors who misuse this additional information. As a result, proof of work was added to most cryptocurrencies.
Proof-of-work
Users can validate cryptocurrency transactions using this consensus technique by resolving a challenging mathematical puzzle. The operation is validated, and a predetermined virtual currency is given to the first individual who completes the puzzle. Then the cycle resumes. The most popular consensus process is this one.
The Pow mechanism
Whenever a user ‘mines’ bitcoin, their computer executes programs attempting to solve the puzzle. Your chances of being chosen to modify the blockchain and receive prizes increase with the processing capacity of your machine. Therefore, to outperform their rivals, miners are motivated to increase the power behind their mining projects.
To further maximize processing resources towards solving these proof-of-work difficulties, application-specific integrated circuit (ASIC) miners and potent processors developed to mine a specific cryptocurrency algorithm were developed. Miners can use ASIC processors to mine any virtual currency, but given the fierce competition, they are now necessary for mining Bitcoin.
Moreover, the distribution of Bitcoin for resolving the riddle and amending the blockchain is also halved after about four years. The award was reduced by half last, from 12.5 to 6.25 coins, in 2020. The amount of carbon dioxide produced to produce one coin doubles overnight after each halving.
Does this apply to all cryptocurrencies?
The most common type of validation is proof of work, which will probably continue to be necessary for the foreseeable future. However, not all virtual currencies using blockchain technology use proof of work to develop them; therefore, they don’t need as much computational power or energy to mine them as coins.
Although validation of blockchains is still required, new validation techniques have evolved that offer equal degrees of security via alternative verification techniques.
Proof-of-stake
With this validation system, miners can access mining rights according to the amount of bitcoin they currently hold by using the coins they already have. They conceal their currencies to establish a validator node to confirm a transaction.
The blockchain selects a random validator node whenever a block of new data needs to be validated. The network can add the block to the blockchain if the validator approves it. They end up losing some of the currency they stake if they try to upload a block of incorrect information.
Ethereum is one cryptocurrency that makes use of PoS. Ethereum decided to switch from a very inefficient proof-of-work system to a more sustainable proof-of-stake system. According to the Ethereum Foundation, the switch cut Ethereum’s energy use by 99.95%.
Proof-of-burn
Proof of burn is a hybrid combination of proof of work and proof of stake. A certain quantity of bitcoin is burned by validators as part of proof-of-burn procedures, permanently removing those coins from circulation.
When validators do this, they purchase virtual mining equipment that operates according to the number of coins burned; the more burned, the faster you mine. Then, you can mine cryptocurrencies without using a lot of electricity.
This approach, which is still relatively young, was developed primarily to solve Environment issues related to mining for PoS. The result is that it has yet to take off. The only cryptocurrency so far that makes use of this method is Slimcoin (SLM), Counterparty (XCP), and Factom (FCT).
Proof of capacity
Proof of capacity employs available storage space on a mining device’s hard drive for verification instead of computing power or stake. The proof of capacity extraction algorithm stores potential resolutions utilizing any free space on a mining device; hence, the more storage capacity you have, the more solutions you may store, increasing the likelihood that you have the right algorithmic solution.
This mechanism is used by a few coins, including Burst, Chia, and Storj.
Proof of elapsed time
The PoET process is comparable to Bitcoin’s proof-of-work (PoW). Still, it uses less energy because it permits a node to go to sleep and perform other jobs for a predetermined period, improving network energy efficiency. It is generally utilized in permissioned blockchains, as opposed to public blockchains, which need access to examine. It’s relatively random because this employs a lottery-style system to choose who gets to modify the blockchain.
Wrapping things up
Is blockchain, therefore, sustainable? It’s still a loaded topic, but there are undoubtedly parts of technology, especially the way it is used, that argue against this. Finding the ideal balance between the scalability of the systems, the quickly developing technology, and the concepts underlying it is the critical challenge.
The idea of a blockchain eliminates the need for intermediaries. It fosters trust between parties in transactional operations. Still, at the same time, the businesses that own the blockchains consume a lot of energy to run them on the systems currently known to exist. Currently, this method accounts for a significant portion of greenhouse gas emissions.
However, there are also signs of progress: new consensus processes are being developed to lessen the harm done to the Environment, and renewable energy sources are being incorporated into current models to improve things. PoS and the other techniques stated above are two examples.
There may be fewer options available for artists to this growing energy increase due to NFTs‘ steady growth in popularity, especially with the emergence of the metaverse.