Worried about the carbon footprint of your Crypto investment? Here are some Green Cryptos you can switch to.
With climate change jumping from news stories into our real life, it has become harder and harder to pretend we can go on living our lives as usual. Environmental disasters are not in our future; they are now very much in our present.
In this heightened awareness of climate change issues, it is impossible to hide the effect of cryptocurrencies mined with enormous amounts of energy. As the proof of Bitcoin’s negative impact on the environment comes to the fore, crypto enthusiasts and the public at large are asking how can they make the crypto ecosystem more GREEN.
China, where over 75% of Bitcoin mining happened, cracked down on miners and some provinces actually booted them out. In terms of companies, an example has been set by Elon Musk, who refused to accept Bitcoin for Tesla’s cars because of its high carbon footprint. Recently, more than 150 companies and individuals in the crypto, finance, energy, and technology sectors signed up to the Crypto Climate Accord, pledging to come together to decarbonize the industry. They have set a ‘net-zero’ target of 2030 for cryptocurrencies.
One of the ways adopted by crypto companies to go green is by pushing for currencies based on Proof-of-Stake or similar models, as opposed to Proof-of-Work models that underpin popular coins like Bitcoin or Ethereum.
Both Proof-of-Stake (PoS) and Proof-of-Work (PoW)models are ‘consensus mechanisms‘, and they are the core requirement to confirm transactions that take place on a blockchain.
PoW is based on an advanced form of mathematics called ‘cryptography‘, which used difficult mathematical equations. Once a problem is solved, the network deems the transaction genuine. However, the complex problems can only be solved with very powerful computers, which require a lot of time and hence energy. PoW is the basis on which the authenticity of blockchain rests and is built into the system of the earlier and most popular cryptocurrencies such as Bitcoin and Ethereum.
According to Digiconomist’s Bitcoin Energy Consumption Index, one Bitcoin transaction takes 1,544 kWh to complete – this equals 53 days of power for the average US household!
On a global scale, Bitcoin mining is using more energy than the whole of Argentina. If it were a country, it would be in the top 30 list of energy-consuming countries.
The Proof of Stake model uses an entirely different way of confirming transactions and reaching consensus. Instead of solving complex mathematical problems, in PoS, currency mining is linked to how much a person has ‘staked.’
In this instance, ‘staked’ refers to the number of coins the person has for the particular blockchain they are attempting to mine. This usually converts to a substantial monetary investment. At the core of the PoS model lies the fact that if you have invested in the system, you would like to see it prosper, and the bigger your investment, the more you have to lose.
Some of the popular PoS green crypto coins are DASH, Tezos, and Cardano. In fact, Ethereum is planning to shift to the Proof of Stake model soon.
Simply put, PoC uses a consensus mechanism algorithm for mining devices in the network to use their available hard drive space to decide mining rights and validate transactions. This method is up to 30 times more energy-efficient than the usual PoW system. A well-known cryptocurrency based on PoC is Burstcoin.
There are many other types of crypto consensus models as well. Some of these are Proof of Activity (a hybrid of PoS and PoW), Delegated Proof of Stake (DPoS), Proof of Importance, Direct Acyclic Graphs (DAGs), etc.
So, now that you understand the underlying concepts behind cryptocurrency mining, it becomes easier to select the right ones to fill your digital wallet with green cryptos.
Here is a list of the most popular eco-friendly green cryptocurrencies for your consideration:
Developed by Charles Hoskinson – the co-founder of Ethereum, Cardano Is one of the best-known examples of Proof of Stake-based crypto. It uses a system called Ouroboros, under which, instead of mining, users have to purchase tokens to join the network.
Even though it is based on the Proof of Work model, Nano has one of the smallest carbon footprints of all cryptos. It uses block lattice technology where each user has an account chain on the network. It uses an Open Representative Voting (ORV) system, where account holders vote for their chosen representative, who then work to securely confirm blocks of transactions.
Using a consensus algorithm known as Tangle (a type of DAG) makes IOTA a scalable and low-cost, low-energy crypto. IOTA uses even less energy than a VISA and Mastercard transaction and recently announced an upgrade that could bring down energy consumption even further.
Based on Proof of Capacity, Burstcoin awards ‘miners’ for storage space. As a hard drive can mine a burst coin on idle, it is seen as one of the most environmentally clean cryptocurrencies. It uses Turing-complete smart contracts, which are used in non-fungible tokens (NFTs) and on-chain games.
A decentralized public network HBAR is flexible enough to use for a variety of transactions as well as for network protection. It is based on the Directed Acyclic Graph (DAG) protocols and is highly energy efficient. Along with its low intrinsic impact, it is also being used to facilitate sustainable energy projects.
Come 2022, Ethereum will make the big risky move to the Proof-of-Stake consensus model. The upgraded Ethereum 2.0 is slated to cut the network’s energy consumption by more than 99%, making it the real ‘green crypto’. If successful, this shift will make Ethereum more eco-friendly, as well as faster and safer.
Green Crypto Powered by Green energy and Activities: Three cryptocurrencies that deserve a special mention
Like all cryptocurrencies, Solar coin is also decentralized and independent of any political or geographical interference. It operates like other cryptos, and its green credentials come from the fact that users earn/mine a solar coin for every Megawatt hour generated from solar technology.
To get a Solarcoin, Solar energy producers must file a claim to register their solar installation via their monitoring system or platform, which verifies and sends solar coins to the user’s wallet for every 1 MWh of verified electricity production.
BitGreen is another Green crypto that caught our eye! It uses low-energy Proof of Stake algorithm and incentivizes users to do green actions to earn the currency. So a user can accrue points by doing one of the many sustainable living activities such as carpooling, buying sustainable products, etc., along with the traditional method of earning BITG with activities for the community such as using their desktop wallet or building a master node.
Another new currency that awards sustainable activities is EcoCoin. It aims to connect ecology and the economy by designing a digital currency to value and reward ecological actions such as ordering a meat-free meal, using green energy, or riding a bike to work. The ECOs earned can be spent in their sustainable marketplace to further power the lifestyle.
The 8 cryptocurrencies mentioned above are just the tip of the iceberg. There are 1000s more that have chosen to consciously work in a sustainable manner. You can visit our site to buy some of the Green Cryptos on the list and use our Coin Casso crypto exchange to snap them up in a safe environment.
A cryptocurrency that uses less energy is considered green. Bitcoin and its peers used the Proof of Work model to mine and get more coins. These activities need a heavy dose of energy and computing power to sustain them, leading to an increase in their carbon footprint.
Green cryptos use an alternative, more energy-efficient models such as Proof of Capacity, Proof of Stake, etc., which use only a tiny amount of energy to achieve transactions or to earn/mine coins. Some of the most well-known ones are Cardano, Nano, and IOTA.
Currently, Ethereum is just a little bit better than Bitcoin as it also uses the Proof of Work model. However, it is about to become super sustainable with a shift to the Proof of Stake model. By moving to a different infrastructure model, Ethereum 2.0 is grabbing the Green Crypto credentials by slashing its energy consumption by 99.95%.
As of 17 August 2021, Burstcoin is trading at $0.03304. It has a total market cap of $27,639,048.
Developed by the founder of BitTorrent, Bram Cohen, Chia uses the Nakamoto Consensus algorithm, just like Bitcoin, but instead of the energy-sucking Proof of Work, it bases its model on Proof of Space and Time. So while the process itself is quite environment friendly, Chia did drive up the demand for hard drives, which do end up as e-waste sooner or later.
Well, yes, there are several: Cardano, Nano, IOTA, BurstCoin, and more. All of these use a very minute amount of energy to be farmed/mined. If you are looking for currencies that mitigate climate change issues, then Solarcoin, BitGreen, and EcoCoin are worth looking into.
EcoCoin is a new cryptocurrency that is farmed by doing sustainable activities. Users are awarded ECOs for eating a meat-free meal or walking to work, or similar earth-friendly actions. It is currently trading at $0.000296 per ECO.
Yes, all cryptos mined or farmed using energy-efficient models or mined on renewable power sources can be termed sustainable or green cryptos.
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