Energy consumption has been one of the hot topics of 2022. At the time of writing, the western world is desperately looking for ways to wean itself off of Russian oil and gas while dealing with spiralling energy costs. In the lead up to the Russian invasion of Ukraine, it was all about bitcoin and the fact that it was consuming more energy than a small country.
It’s clear that we need to make some changes, and cryptocurrency plays a big role in that. If bitcoin is going to be the future, a solution is needed. So, how are things progressing and will bitcoin change its power-hungry ways?
Proof of Work
The “proof of work” software code used by bitcoin requires an immense amount of energy. It requires the use of vast computing power to validate and secure the transactions. This is how bitcoins are “mined”, and in the process, a great deal of power is used.
Ethereum, bitcoin’s rival currency, uses an alternative “proof of stake” process and this reduces the energy use to just 1% of what is used during “proof of work”. It’s not just ethereum, either. Ripple is also making huge ground toward eco-friendly validation and is one of the greenest currencies out there right now.
This makes both ripple and ethereum much more viable options as a future global currency, but that doesn’t mean that bitcoin is giving up the ghost. It can still turn things around and the groundwork is already being done to make a green future viable.
How Bitcoin Can Change
Bitcoin, like ethereum, can change how coins are validated and mined. It’s not an easy fix, but it’s the ultimate solution and one that will remedy the problem this currency is facing.
Another solution is to change the power that’s being used to run those computers, and that’s already happening.
Bitcoin mining centers are adapting to run on solar and wind energy. If the energy used to power these computers doesn’t come from fossil fuels, then it’s not part of the problem.
But the fix is not quite that easy.
Green energy is expensive and bitcoins are mined for profit. If the goal is to turn a profit, bitcoin miners are going to seek the cheapest fuel that they can find, and that means turning to fossil fuels.
Experts have already expressed concerns that if the west switches to solar and wind energy, cryptocurrency farms will look to cheap oil produced in Russia and the Middle East. After all, if no one is buying that oil and everyone has switched to greener, cleaner, and more expensive solutions, the black stuff will be cheap and plentiful.
What Does the Future Hold?
Whatever the future has in store for cryptocurrencies, it seems likely that one of two things will happen.
Either bitcoin will be overtaken by ethereum, ripple, or another greener cryptocurrency, or bitcoin will buck up its ideas and find a way to avoid siphoning those fossil fuels. Something needs to happen and it looks like we’re seeing the beginning of those changes in 2022.