Ethereum, the second leading cryptocurrency in the world has decided to move a step ahead in proof-of-stake in future. Ethereum has made a move in PoS, to cut more consumption of energy and reduce it by 99%. Energy expansion plays an important role in the Ethreum blockchain security, therefore, neglecting energy for the development of Ethereum is not possible.
Ethereum Mining Impacts Environment
In the crypto market, digital currencies face an allegation of consuming too much energy and being called inefficient and environmentally unfriendly. However, the thought on cryptocurrencies’ consumption of energy is not the same, as most believe it consumes fewer energy others believe it uses more energy than gold mining. As per the research done on cryptocurrencies and energy consumption, mining the digital currencies are harmful to the environment.
Ethereum, a cryptocurrency started its journey with the goal of becoming a world computer. The idea of blockchain was the first step to introduce smart contracts. Last year, the price of Ethereum surged more than $1400 and as of now, it is trading below $200.
Ethereum’s Concept of Proof-Of-Work
Ethereum runs on the same idea of Bitcoin using Proof-Of-Work to secure the blockchain technology. It has already been highlighted by the CEO of Ethereum, Vitalik Buterin that energy is very important to secure the blockchain of Ethereum.
It is important to consider that there are people in the world who are deprived of basic things like electricity. The PoW based blockchains aid miners to cryptographically secure transactions. It calls miners to equip them with the computational capacity which leads to burning millions of dollars in electricity and other costs regarding crypto mining.
Vitalik Buterin believes that Proof-of-Work is purely depending upon the large quantities of electricity, whereas, the mining hardware is totally based on the assumption that it generates a lot of cryptocurrencies as a reward. Therefore, it is clearly seen that mining power linked directly to the revenue.
Proof-Of-Stake is a little different from Proof-Of-Work, as in PoS randomly picks validators (the equivalent of miners) to secure transactions whereas in PoW, miners compete to process the same set of transactions.