Ethereum’s merge into a proof-of-stake consensus mechanism is easily one of the most anticipated events in cryptocurrency’s history.
After the transition is complete, Ethereum will completely abandon proof-of-stake – which means that the second largest cryptocurrency by market capitalization in the world will forego the need for mining in order in order to run the network and create new currency.
Abandoning proof-of-work means that the over 260 million mining wallets attached to Ethereum will no longer be able to mine the cryptocurrency. In other words, the cryptocurrency will require a lot less energy to run its blockchain.
How Does Mining Affect The Environment?
Proof-of-Work is the consensus mechanism required for miners to create new currency.
The process involves validating complicated math problems by using computers with powerful graphics in order to quickly solve the equations.
The requirement of bulky GPUs makes the mining process require a lot of energy.
To put it into perspective, Statista reports indicate that the total energy consumption of Bitcoin mining is comparable to what the entire country of Norway uses. Bitcoin also uses three times more energy than Switzerland.
According to The Digiconomist’s Bitcoin Energy Consumption Index, it takes 1,449 kWh to conduct one bitcoin transaction. That number is comparable to around 50 days of what a typical US home consumes in electricity, to conduct one bitcoin transaction.
Mining also generates larger amounts of electronic waste, and Bitcoin’s 775.56 kgCO2 carbon footprint is equivalent to watching nearly 130,000 hours of Youtube videos.
In today’s day and age where global warming and environmental protection are important topics for governments worldwide, the energy required to mine cryptocurrencies is generally one of the first talking points local governments run to in order to impose sanctions or even ban the trading and mining of cryptocurrencies for citizens.
In its defense, Bitcoin appears to also plan to significantly drop its carbon footprint in the upcoming years. Today, nearly a third of its energy consumption is already coming from renewable sources.
Experts also believe that Bitcoin will be the first cryptocurrency to reach net-zero carbon emissions by 2024.
The Merge – Greener and Cleaner
The second largest cryptocurrency in the world is due to change its consensus to proof-of-stake.
This means that Ethereum will become significantly less energy wasteful.
After the transition is complete, Ethereum will reduce its energy use by 99.9%. That number indicates that the energy impact after the merge will be as if a country like Chile, which has nearly 22 million people, stopped 99.9% of its energy use overnight.
Going green is also a better way of getting high-profile companies to enter the blockchain world.
Recently, Starbucks announced an NFT partnership with Polygon. The coffee-house chain stated that it decided to choose Polygon due to its “environmentally friendly” policies.