According to the NewScientiest, researchers have reported that Ethereum, the world's second-largest cryptocurrency, has successfully reduced its emissions by 99.99% after an unprecedented experiment to abandon power-hungry mining in favor of a new approach.
Ethereum, along with many other cryptocurrencies, previously relied on a method called "Proof of Work" (PoW) to secure its network, which involved computers performing extensive calculations to mine new currency and verify transactions, resulting in significant energy consumption. But in September 2022, Ethereum implemented a new system called "Proof of Stake" (PoS) during a period of change known as the Merge.
The Cambridge Centre for Alternative Finance (CCAF) has released new data on the energy consumption of Ethereum, following its previous analysis of bitcoin's energy use over the past four years. The latest update, which was developed by Alexander Neumüller at the University of Cambridge, has successfully achieved a "staggering" reduction in electricity consumption.
The updated Ethereum system now allows validators to deposit funds into the network in exchange for the privilege of verifying transactions and receiving rewards, replacing the need for computer hardware to mine new currency. The Ethereum Foundation, a non-profit organization that oversees Ethereum's development, predicted that the Merge would reduce energy consumption by 99%. The results of the transition were uncertain, however, as nothing of this magnitude had been done before.
According to data from the CCAF, Ethereum, much like bitcoin, had been consuming increasingly more energy every year since its inception in 2015. In 2021, it used a total of 16.4 terawatt hours, but by September 14th, 2022, a day before the Merge, the energy consumption had already reached 17.6 TWh, and the year-end estimate was set to be 21.4 TWh.
However, the CCAF's latest estimates reveal that Ethereum's energy consumption is expected to drastically decrease to just 6.6 gigawatt hours annually, equivalent to the electricity used by approximately 2,000 typical UK homes. This is a stark contrast to the energy consumption of Ethereum since its launch until the Merge, which amounted to a total of 58.3 TWh, similar to Switzerland's annual electricity consumption.
Blockchain experts have dismissed the possibility of bitcoin adopting the energy-efficient proof-of-stake mechanism, following Ethereum's successful switch to the system. According to Neumüller, bitcoin's current proof-of-work approach is deeply ingrained within the network and therefore difficult to change. Ethan Vera, co-founder of Luxor Mining, further adds that energy consumption is crucial to bitcoin's security, making it unlikely for the network to consider such a change. While Ethereum's switch has raised hopes of a more sustainable future for cryptocurrencies, bitcoin is unlikely to follow suit anytime soon.