Do Altcoins Provide a Greener Alternative to the Energy-Intensive Crypto Bitcoin?
Making things easier, technology is considered as a solution creator but along with that, it is also making some problems for everyone in society. Living in a period of rapid change with technological developments, revolutionizing the way we live, is influencing climate changes and causing the world’s most severe environmental concerns.
The Bitcoin Energy Crisis
Likewise, the cryptocurrency, now trending very much these days and specifically Bitcoin, the biggest crypto, is consuming more electricity in a year than the whole of Argentina, one of the surveys says. Actually, creating Bitcoin needs a process, called mining, achieved by powerful devices and expert professionals who work day and night to solve complex mathematical problems.
For this purpose, around 70% of these kinds of setups are working in China demanding more and more energy to mine bitcoins. According to Digiconomist, Bitcoin produces 36.95 megatons of CO2 per annum, which is incredibly energy-intensive. One of the Chinese regions, Inner Mongolia plans to ban new cryptocurrency mining projects to cut down on the energy-consuming operations.
Recently, the UK police discovered an illegal bitcoin mine, stealing thousands of pounds worth of electricity from the power grid. Police found numerous wiring and ventilation ducts there and also detected a lot of heat coming out from there.
After China, around 4.5% of Bitcoin mining took place in Iran between January and April of this year, putting it among the top 10 in the world. It has initiated environmental concerns. Elon Musk also tweeted in May 2021 that Tesla would no longer accept Bitcoin as payment for its vehicles due to its poor green credentials.
Are Altcoins a Better Alternative?
Tech-specialists have been very much concerned about these environmental concerns. Another form of cryptocurrency, termed “altcoins”, is being considered as far greener than bitcoin and that’s why a lot of investors are turning to them. Many of the altcoins use less harmful technology to produce each coin.
One of the alternatives is the mining process of Ethereum. It is the world’s second-largest cryptocurrency after bitcoin, using a different protocol, called “proof-of-stake”, specifically designed to look into the environmental concerns aroused by the “proof-of-work” system by eliminating the competition between the miners.
Investors are switching to Ethereum, as proof-of-stake is supposed to remove the need for competition between data miners so that less energy is consumed and this makes it stabilized.
Other than this, Litecoin is also similar to Bitcoin and requires a short time to be produced with a standard computer consuming less electricity to run. Powerful hardware with excessive energy is required for bitcoins to be mined. So yes, altcoins do provide a greener and much more effective solution to the energy crisis caused by Bitcoin due to its extensive energy-consuming nature.
As discussed above, Bitcoin is somehow causing some environmental damage when producing a coin. For this purpose, investors now look for the green credentials of altcoins while deciding which cryptocurrency to convert their bitcoin into, and most likely Ethereum’s system will be adopted.
Let’s strive together for a greener future for cryptocurrencies and hope for the best.