It is no myth that cryptocurrency transactions for mining processes require a massive volume of energy. Bitcoin undoubtedly takes the pie, but its silver brother Ethereum is not much behind. The brighter side to this is that the Blockchain carbon footprint is slowly decreasing.
A Twitter user- Digiconomist, in a recent study presented the numbers of Ethereum’s position with regards to energy consumption. He tweeted,
“The latest #Ethereum Energy Consumption Index is 7.737 TWh per Year/0.72 Mil US households (+3.9%)
44.2 KWh per unique transaction (powers 1 US household for 1.5 days) #MakeEthereumSustainable”
Consumption level for Ethereum has increased since February 2014 at a steady pace, exceeding 20 TWh four years later in late 2018. However, the subsequent drop has been pretty impressive. The consumption level fell sharply below 10 TWh early in January this year.
The stats further revealed that Ethereum’s annual consumption of electricity, which is equivalent to the consumption level of the South African nation Angola, is estimated to be 7.91 TWh, of which energy utilized per transaction is estimated to be around 45 KWh. Both annualized global mining revenues, as well as annualized global mining costs stand at a value of $790.6 million. This exorbitant amount of energy could be deployed to power over 732k households.
Ethereum holds 0.04% of the total of the world’s electricity consumption. Bitcoin, which has an annual carbon footprint of over 23 kilo-tonnes, gobbles a considerable chunk of 0.22%.
Bitcoin and Ethereum combined stand at 45th on the world’s map for energy consumption level behind Israel at 43rd and Greece at 44th.
The report further points out that over 4 million households in the US can be powered with the amount of energy used up by the Bitcoin payment network. This is mammoth as compared to the energy consumed by the silver crypto coin which could power a little less than 1 million US households, this too is no glad tiding of joy as a traditional payment system like Visa stands out as the most energy efficient.
Stressing about the magnitude of power depletion, Vitalik Buterin, co-founder of Ethereum earlier this year, asserted:
“That’s just a huge waste of resources, even if you don’t believe that pollution and carbon dioxide are an issue. There are real consumers—real people—whose need for electricity is being displaced by this stuff.”
The persistent energy issues that have plagued mining involved in the POW process will soon be a thing of the past however, as plans to roll out an efficient feature for the silver coin are underway.
To mitigate outrageous energy consumption and for scaling purposes of the mainstream Proof-of-stake [POS] blockchains, Ethereum will soon implement Casper. Currently, Ethereum purely rides on proof-of-work. This new POS upgrade is believed to substantially reduce power utilization by eliminating the miners all together.
In POS, the validators are equivalent to the miners. In sharp contrast however, the validators need to put up stakes [as collateral]. The higher the stakes, the more chances are to be chosen as a validator, which requires no grand computational power to legitimize a transaction on the network.