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Blockchain Delivers a Glimpse of Future Innovation Today

The media is always keen to report on the latest developments around blockchain and digital currencies and pull in colossal numbers of readers hungry to explore the details behind the headlines. Many commentators are switching on to the reality that, despite the fluctuating price of some coins and utility tokens, the underlying blockchain technology continues to grow in spectacular leaps and bounds.

Blockchain is not just about digital currencies and faster peer-to-peer transactions but part of an advanced ecosystem of emerging technologies encompassing artificial intelligence, robotics, and commerce.

One of the many exciting areas that blockchain will radically evolve is the current energy market by providing a multitude of opportunities that may not yet have even been considered. Blockchain technology will blur the boundaries between cash, energy products and it will also facilitate the surge of crossovers into other commodities, transforming them all into readily tradable digital assets. Let’s map things out a little and put things into perspective and look to the future. Imagine the trading floor in the near future, say five years from now.

It’s a lot quieter; there’s no commotion, there’s no need for the calamity of traders with phones pressed to their ears scrambling for the best rates. Now trading robots are using advanced algorithms to scan the electricity market in real-time, automatically optimizing the search to get the best deal for the customer based on their predicted needs for that period taking into account the weather and past usage, etc.

At home, the customer uses her now old Samsung S10 mobile device to approve the terms of sale, and a smart contract is made, then the trade is executed and immediately recorded on the blockchain. The electricity provider can automatically access the blockchain information, and physical payment occurs daily with the payment initiated immediately through their choice of Digital Wallet.

All activity is now instantly accessible by the seller, buyer, pipeline and the remittance provider – and this is only one example of thousands, if not millions, of use cases of blockchain technology. Businesses will rely on more and more AI systems to act as a translator of their needs and automate their processes while handling enormous volumes of data, all with extremely low transactional costs and reduced risk.

Intermediaries such as brokers are sitting up and taking notice as their entire business models could be affected if they fail to integrate blockchain technology into their ecosystems. These benefits are undoubtedly seductive and hard to ignore, but does this scenario sound a little too far-fetched, especially in the time frame stated above? Perhaps, or perhaps not but who really knows in this exciting, fast-paced hyper-connected world in which we find ourselves.

While we are not able to actually see into the future, the potential of Blockchain technology for allowing remittance to be made to energy providers through a digital wallet is not too hard to imagine. And finally, the use of digital wallets on smartphones continues to raise exciting possibilities for their use in the developing world.

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German Government to Revamp its Energy Sector with Blockchain-Based Strategy

Peter Altmaier, Germany’s Federal Minister of Economics, has asserted that blockchain technology, presents tremendous opportunities in pilot projects. As a result, it will come in handy in revamping the nation’s energy sector through strategies, such as digitalization.

The minister has proclaimed that the German government intends to support various blockchain projects, as well as incorporate innovative cross-technological laboratories in the energy industry. He also notes that blockchain technology will instigate process efficiency and transparency in the country’s energy industry.

Altmaier stipulates:

“The potential of the still young blockchain technology is high. Germany is one of the world’s leading locations. With the blockchain strategy, we want to contribute to maintaining and expanding this lead. One focus is on the energy sector. Here we can score double by using the opportunities of blockchain technology in pilot projects and at the same time driving forward the digitization of the energy transition.”

Blockchain technology is transformative

Blockchain technology has the potential of transforming the energy industry by propelling efficiency in financial flows or power trades.

The German government intends to transform the energy sector by using blockchain in the following:

Stimulating and stabilizing innovations in this industry.

Propelling investment opportunities by making framework conditions reliable and precise.

Digitalization of administrative services in this sector.

Spreading information through collaboration and networking.

Olaf Scholz, Germany’s Federal Finance Minister, also weighs in by stipulating that the nation wants to be the desired technology location in the world.

He asserts:

“We want to be at the forefront and further strengthen Germany as a leading technology location. The blockchain technology can contribute to this. It is a building block for the Internet of the future. At the same time, we must protect consumers and state sovereignty. A core element of state sovereignty is the issuing of a currency, we will not leave it to private companies.”

Notably, the blockchain strategy crafted by the German government is intended at exploiting unique opportunities, as well as the mobilization of its capabilities for digital transformation.

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Traditional Banking System Consumes Twice Energy Than Bitcoin Mining, New Research Reveals

A new study released by Galaxy Digital Holdings Limited shows that the traditional banking system consumes double the amount of energy that Bitcoin mining uses.

Galaxy Digital, an asset management company owned by crypto bull Mike Novogratz, released a quantitative study comparing Bitcoin’s energy consumption to the traditional banking system and gold industries, accompanied by numeric calculations and analysis.

The authors of the report estimated the energy usage of the entire Bitcoin network at 113.89 terawatts per hour – 99% of which comes from operating mining machines. The estimate comprises node electricity consumption, pool electricity, miner electricity consumption, and miner demand.

As of March 2021, Cambridge’s Center for Alternative Finance estimated Bitcoin’s energy usage at 120 terawatts per hour.

Based on the calculation of the report, Bitcoin energy consumption is only half of traditional banking. The report estimated that the traditional banking system industry consumes the most energy at 263.72 terawatts per hour, while gold mining consumes about 240.61 terawatts per hour.

The report further identified four major areas of electricity consumption within the traditional banking system with sufficient data, including ATMs, bank branches, card network’s data centres, and banking data centres.

The report, on the other hand, also disclosed that Bitcoin’s features could enable people to enjoy financial freedom across the globe, stating that the Bitcoin network “can benefit from the energy sector by creating perfect use cases for intermittent and excess energy, and the network will only scale further if network adoption warrants it.”

However, the report acknowledged that energy consumption is not necessarily bad and said that people would continue looking for new technologies that require more energy that challenges the status quo. While authors noted that Bitcoin is a good example of such technologies, they said that the crypto network’s electricity consumption is acceptable for energy use.

Crypto Energy Debate Fact Check

The development and release of the new study come when an ongoing debate about the energy usage of cryptocurrencies continues to rage. Last week, Elon Musk, Tesla CEO, said that the electric car manufacturer stopped vehicle purchases using Bitcoin because of climate change concerns. Bitcoin price dropped by more than 10% after the announcement, while Tesla shares also dipped.

In February, Tesla announced that it purchased $1.5 billion worth of Bitcoin for its balance sheet. However, the acceptance of Bitcoin (BTC) as a payment approach for its motor vehicle products and their services purchases in March encountered an outcry from some investors and environmentalists.

Market analysts see Tesla’s move to halt Bitcoin payment as an attempt to appease investors’ concerns who are focused on environmental sustainability and climate change. BTC advocates insist that BTC mining mainly involves renewable energy, despite part of the process of mining by miners reportedly are conducted in the cheapest way in China. Its electricity is generated by coal.

Therefore, the study research published by Galaxy Digital shows the pieces of evidence that the traditional banking system consumes significantly higher amounts of energy than the Bitcoin network.

Square Says It Has No Plans of Purchasing More Bitcoin After $20 Million Loss

Square has revealed that it has no plans of adding more Bitcoin to its balance sheet for the time being – after losing $20 million on its $220 million Bitcoin investment in the first quarter of 2021.

Amrita Ahuja, the Chief Financial Officer at Square Inc., said that the California-based financial services and digital payment company did have any plans of purchasing more Bitcoin.

“We don’t have any plans at this point to make further purchases,” Ahuja stated.

“There’s no plans at this point to re-evaluate where we are from a treasury standpoint,” with regard to cryptos, she further said.

However, the CFO mentioned that there are still “lots of other opportunities” for Square to “learn with Bitcoin” and that the firm, was “always evaluating” possibilities in the space.

Square made Bitcoin purchase of $50 million for its balance sheet in October 2020 and made an additional purchase of $170 million in February this year.

Square released its last quarter earnings that ended March on May 6 and the firm stated that it had lost $20 million on its Bitcoin investment despite its fair value increasing to $472 million based on market prices.

Ahuja mentioned that Bitcoin purchase on its balance sheet amounted to about 5% of its cash on hand.

“We’re always evaluating and as ever, I think we’d be customer-led. As we see the evolution of the bitcoin product or crypto products in general, I think we’ll make further assessments at that point,” she said.

However, the CFO said that the company had not changed its stance on Bitcoin and would continue evaluating its Bitcoin investment on an ongoing basis.

Square’s first-quarter revenue increased 266% year-on-year in March to $5.06 billion and this was mainly thanks to Bitcoin revenue generated from its Cash App. Square’s Cash App brought in $3.51 billion in Bitcoin revenue during the first quarter of 2021, which is 11 times higher than what it generated last year.

Ahuja further remarked on Square’s stance regarding Bitcoin, saying that the crypto industry needs innovation in terms of renewable and clean energy.

“There’s a broader supply chain question around how renewables and clean energy become a greater part of the blockchain in general, and a greater part of the overall mining and transaction network…It’s the overall fixed footprint of the network that we need to address,” she added.

People Worry About Bitcoin Energy Usage

Square’s change of tone towards Bitcoin comes a few days after Tesla stopped accepting Bitcoin payments for its vehicles, citing the environmental impact of the crypto. On May 12, Tesla electric vehicle manufacturing company announced a complete reversal of its initial plans to accept Bitcoin payments for its vehicle products and services. The company cited the digital currency’s energy inefficiency as the reasons for stop accepting Bitcoin payments.

However, Elon Musk, Tesla founder and CEO and the big Bitcoin advocate, hinted that the company may not be done with cryptos altogether. The billionaire said that the auto manufacturing giant will still hold on to its Bitcoin investments, which consist of about $1.3 billion worth of Bitcoin.

Tesla and Square are not the only ones concerned with the environmental impact of Bitcoin.

In February this year, Janet Yellen, The US treasury secretary, warned that Bitcoin uses a “staggering” amount of power and is “extremely inefficient” for making transactions.

It is complicated to understand whether Bitcoin really harms the environment. But Bitcoin critics have long been wary of its impact on the environment. According to the Cambridge Bitcoin Electricity Consumption Index, Bitcoin uses more energy than certain countries, such as Malaysia and Sweden.

Elon Musk: Lightning Network Needed to Fix Scalability Problem in Bitcoin Network

Elon Musk, the founder and CEO of Tesla Inc., sparked on Twitter Saturday, suggesting that the layer-2 payments Lightning Network are required for now to scale Bitcoin (BTC) transaction. The billionaire said that the Bitcoin network could meet increasing demand if its users adopted the Lightning Network, a payment that makes Bitcoins transactions cheaper and faster.

“Bitcoin hashing (aka mining) energy usage is starting to exceed that of medium-sized countries. Almost impossible for small hashers to succeed without those massive economies of scale. For now, Lightning is needed,” Musk said on Twitter.

Lightning is a type of software that processes BTC transactions out of the Bitcoin blockchain to lighten the loading on the network. In other words, Lightning enables cheaper and faster transactions by enabling user-generated channels for receiving and sending payments.

Musk, therefore, suggests that lightning would be necessary to offer the required bandwidth.

“Layer count depends on projected bandwidth & compute, both rising rapidly, which means single layer network [e.g. Bitcoin alone] can carry all human transactions in future imo,” Musk said.

Without this Lightning, currently, it costs an average fee of $13 and takes 14 minutes to move funds across the Bitcoin network.

The Lightning could help to move funds at the cost of about one satoshi (0.00037636 USD), and transactions are almost instant.

However, critics claim that the Lightning Network sacrifices decentralization as some computational work out of the Bitcoin blockchain.

Musk termed achieving truly decentralized finance – to empower people – as a noble and vital goal, responding to BTC Session, a Twitter crypto advocate, who asked whether Tesla CEO had put into consideration whether lightning sacrificed on decentralization.

Lightning Labs Inc., which based in Silicon Valley, California, began developing the Lightning Network in 2016 and launched a protocol in beta in 2018. Square and Twitter CEO Jack Dorsey is among investors in Lighting Labs.

Green Bitcoin Alternative

A few days ago, Musk commented on BTC due to the crypto’s environmental impact and reliance on Chinese miners. The Tesla CEO has recently talked about Bitcoin’s energy consumption on Twitter, especially a shock announcement that Tesla stopped accepting Bitcoin payments for its motor vehicle sales.

Musk is looking at cryptocurrencies’ that uses less than 1% of Bitcoin’s energy usage. Dogecoin (DOGE) developers revealed that the Tesla CEO had offered funds to improve the network, which consumes a fraction of Bitcoin’s energy consumption.

Meanwhile, Musk suggested ten major cryptocurrency mining firms that should post audits of the amount of renewable energy used in their operations as a way to address the energy consumption matter.

Why Cryptocurrency Massive Energy Consumption Is Extravagant?

Do you know that bitcoin mining consumes around 128.77 terawatt-hours(TWh) a year? And is it likely to fall unless the value of currency collapses? Mining for cryptocurrency consumes a massive amount of power with heavy computers and machines, leaving a destructive impact all over the globe.

Mining is the process that involves transaction verification on the blockchain without relying on a central authority. Mining computers thrive on solving complex problems, and those computations require a massive amount of energy. There is a reward with newly mined coins and transaction fees once bitcoin miners solve this problem.

According to Cambridge University, bitcoin is presently representing 0.59% of the total global energy consumption. Digiconomist estimates that network energy consumption is hitting the figure of 82.026, which is, according to the site, comparable to Chile’s energy consumption. Since the beginning of 2020, Bitcoin energy consumption has surged up to 80% amongst an immense evolution in digital currencies.

Let’s have a deep insight into enormous energy consumption and its adverse impact on environmental sustainability.

Massive Electricity Consumption

Cambridge university suggested that bitcoin mining consumes more electricity as compared to the electricity consumption in Argentina. According to online tools, bitcoin electricity energy consumption is more than Argentina, i.e. 121TWh, the United Arab Emirates, the Netherlands, i.e. 108.8 TWh, and presently creeping up to Norway, i.e. 122.20 TWh.

Specialized computers are connected to cryptocurrency networks to mine. Their main job is the verification of transactions that send or receive bitcoins. This process includes solving complex problems, providing an obstacle for the assurance of combating fraudulent activities. Moreover, critics claim that tesla’s decision to invest a hefty amount in bitcoin. This week, the currency value hit the figure of $48,000, and according to tesla’s announcement, it has brought up to $1.5bn bitcoin and plans to accept it as a payment method in the upcoming years.

According to the 3rd global crypto-asset benchmark study, 28% of the total energy consumed by crypto-mining come from renewable resources. People often develop an interconnection with a massive number of miners to the network to gain immense profits. That utilizes an unexpected amount of electricity because computers are more or less continuously working to solve puzzles. It is possible to estimate how much electricity is being consumed at a time by considering energy demand for the bitcoin network and the average electricity price per kilowatt hour ($0.05).

What Bitcoin Mining Experts Have To Say?

Let’s have a deep insight into what bitcoin mining experts have to say about the alarming bitcoin mining energy consumption, which is currently progressing by leaps and bounds.

#1 Dan Held

The head of growth at crypto exchange Kraken, Dan Held, proclaims that the bitcoin network has been unjustifiably aimed by those claiming that bitcoin is taking its energy consumption irrationally.

Dan Held declared that:

“What it really boils down to when people argue that they don’t like bitcoin energy consumption is they don’t actually like bitcoin. People who are not in favour of cryptocurrencies anticipate that bitcoin mining energy consumption is wasteful.”

Dan Held emphasizes the fact that everything in this world requires energy consumption, and with technological advancements, the amount of energy required to power that technology is facing immense growth in the near future. Almost all the things in our lives consume energy. Claiming that one utilization source of energy is less wasteful than others is absolutely subjective as all utilizations have paid market rates to use that energy.

#2 Thillainathan

Thillainathan told business insiders that more energy consumption is required as the bitcoin network grows and simultaneously the profitability of mining increases. As an operator of mines, he affirms that minors should take environmental enigma under consideration during the mining process as energy consumption can adversely impact. He expects that bitcoin mining is beneficial as bitcoin prices surge in the market, and more miners should consider utilising renewable energy resources with this upcoming revolution.

He claimed in front of Insider that:

“Being a strong believer of bitcoin, it is an efficient way to store wealth but being an infrastructure provider, it is a dire need that we are required to become as environmentally friendly as possible.”

Thillainathan stated that the energy utilised during mining is called “dirty energy”, and unfortunately, the energy is not sustainable in the longer run. He professes that one day the government will crackdown on the utilization of coal plants.

#3 Mason Jappa

The CEO of blockchain solutions, Mason Jappa, who is also working as an operator of some of the largest mining rigs in the United States, affirms that bitcoin miners are financially incentivized for the operation on the cheapest possible electricity, which often concludes that they utilize energy that would have become useless.

Mason Jappa tweeted that,

“Bitcoin mining enhances energy efficiency and simultaneously reduces kWh energy rates for the populous through curtailment agreements, ceasing energy consumption during peak hours, aims at renewable energy, improves energy technology, and reduces natural gas flaring. ”

Jappa claims that US mechanisms are powered by the process which is called “gas-flare recapturing”. A chunk of gas is flamed out in the air when natural gas is mined. Bitcoin miners prevent that to release into the air and capture that flare for energy utilization.

Environmental Enigma

Environmental impact is thriving in parallel to bitcoin’s emergence and prominence. There would be no doubt in saying that crypto mining requires an enormous amount of energy. According to the latest data analysis by Cambridge bitcoin energy consumption (CNBC), this energy consumption might alarm Treasury Secretary Janet Yellen.

Yellen said that:

“It is the most incompetent method of carrying out transactions, and the amount of energy consumes during the mining process is staggering.”

Also, CAGF explained that:

“The more machines operate for mining, the more there is a possibility to solve complex problems. However, more operating machines mean more energy consumption which raises the question of miners’ cost. ”

CCAF affirms that they do not have enough data that backs the determination of crypto solution carbon footprint. Hence the major concern is growing bitcoin mining energy consumption and the threats that it is imposing to United Nations Sustainable Development Goals in the upcoming years. Also, it is a major concern for encountering the climate crisis.

Bitcoin Accelerates the Development of Renewable Energy for Bitcoin Mining

El Salvador’s decision to use volcano power to mine Bitcoin (BTC) was propelling the leading cryptocurrency’s quest to accelerate the development of renewable energy, according to CNBC.

Therefore, this approach was boosting Bitcoin’s carbon footprint of making crypto mining green.

Precisely, El Salvador’s move into volcano-powered BTC mining made the case that Bitcoin can act as an accelerant to renewable energy development. Geothermal energy is renewable, clean, and in some places, it makes use of a previously untapped resource.

Late last month, Nayib Bukele, the president of El Salvador, posted a video with the caption “first steps” accompanied by a volcano emoji via his Twitter account, showing that the nation began its project to use geothermal energy from volcanoes for bitcoin cryptocurrency mining.

The video footage showed a glimpse of a new volcanic geothermal Bitcoin mining facility being built in El Salvador, the first nation to legalize Bitcoin as legal tender.

Investing in sustainable crypto mining

According to Bradley Rettler, a philosophy professor at the University of Wyoming:

“Every Bitcoin miner decreases the profitability of all others. Every miner using renewable energy decreases the profitability of all the ones using carbon-based energy. So, if you want Bitcoin to be greener, invest in sustainable mining.”

At the start of this month, El Salvador had mined 0.00599179 BTC or approximately $269 using power harnessed through a volcano.

El Salvador has been continuously setting foot in the crypto space, given that the nation previously bought 150 new Bitcoins pushing its accumulation to a total of 700 BTC.

Bitcoin transaction volume continues to spike

On-chain metrics provider Glassnode noted:

“Bitcoin entity-adjusted transaction volume spiked in the last few weeks, ranging from between $13.8B and $16.0B. These elevated volumes have been sustained in this range for 3 weeks. The current volume is only slightly less than the ATH of $16.8B set on the price ATH in April.”

Glassnode added that substantial transactions dominate the current transaction flow. Moreover, 2021 has seen notable growth in large-size transaction ($100K+) dominance as institutional capital, and higher prices have lifted USD denominated value.

Energy Crisis Is Forcing Cryptocurrency Mining Companies Out of Kazakhstan

Power shortages are causing some cryptocurrency mining firms to leave Kazakhstan and move to other nations.

Crypto mining company Xive announced on Wednesday, November 24 that it is moving its mining farm out of Southern Kazakhstan due to electricity shortages.

Didar Bekbau, the co-founder of Xive cryptocurrency mining firm, talked about the development and said that the firm is shutting down a 2,500-rig mine in South Kazakhstan because of a lack of adequate electricity supply from the national grid.

“Sad to shut down our mining farm in south [Kazakhstan],” he stated.

Bekbau said that the southern part of Kazakhstan is no longer a viable place for cryptocurrency mining activities because of electricity shortage and the national grid has made it difficult to transfer power from energy-rich areas in the north to more energy scarce regions in the south.

The southern part of the nation is especially vulnerable as the region lacks sufficient electricity generating plants and the national grid cannot reliably transfer electricity from the energy-rich northern region.

It is clear that mining in south Kazakhstan is not possible anymore, Bekbau stated. While he did not mention if he was moving mining out of the nation entirely, he stated that Xive is preparing a new site for its over 2,500 machines.

Crypto miners such as Energix and Xive, have been facing electricity issues since September because of the rationing from KEGOC, the national grid operator of Kazakhstan.

Bekbau disclosed that some crypto mining firms are moving from the country to places like Russia and the U.S. as there are no options left in Kazakhstan.

The Mining Sector After the Boom

According to data from Cambridge Centre For Alternative Finance, Kazakhstan currently ranks second behind the U.S. in global Bitcoin mining, accounting for an 18.1% Bitcoin mining hashrate, up from 8.8% in June.

The nation is struggling to meet the energy needs because of its booming cryptocurrency mining industry, which has been flourishing thanks to cheap power and an influx of crypto miners from neighbouring China.

Miners flocked to Kazakhstan after China banned crypto mining in May.

But the mining boom has strained Kazakhstan’s energy supply which is majorly powered by coal production in the northern part of the country. And since July, the country has experienced blackouts in different parts of the nation.

Lawmakers in the country have blamed energy shortages on cryptocurrency mining farms. Kazakhstan’s first vice Minister of energy, Murat Zhurebekov, announced in a press conference in early November that cryptocurrency mining has caused an 8% rise in energy demands on the national grid this year. Electricity demand normally increases by 1% or 2% every year, he stated.

On November 19, Kazakhstan President Kassym-Jomart Tokayev acknowledged in a press briefing that the country is number 2 in the world in terms of crypto mining, but does not see financial returns.

Unregulated farms have been mentioned as the reason why the government so far has witnessed little benefit from the mining boom. Kazakh officials claim that illegal crypto mining activities are the key root cause of the nation’s energy problems.

In the press conference, Zhurebekov admitted that Kazakhstan is not going to simply watch illegal miners consume electricity and contribute to the energy shortage.

However, the country appears friendly and has been careful towards handling the crypto mining activities and as result is pushing for more regulations of the industry rather than imposing a total ban on the sector.

Bitcoin Mining Transforming Global Energy Crisis, Says Arcane Research

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Arcane Research, a Norway-based digital asset analysis company providing data-driven analysis and bespoke research within the field of cryptocurrency, has published a report examining the relationship between Bitcoin mining and global energy.

The report states that the crypto mining industry has the capacity to transform worldwide energy production for the better, contrary to what is normally viewed as social and environmental harm associated with the sector.

The paper provides four ways in which mining can improve energy systems in a desirable and economical manner.

First, crypto mining is becoming a catalyst for the development of renewable energy projects. Bitcoin miners have recently started buying the cheapest sources of energy available, renewable (wind and solar) sources of energy.

In this way, cryptocurrency mining provides an economic incentive to build more renewable energy projects and help minimize fossil energy consumption.

On the second note, the constant energy produced by the flexible, reactive power of Bitcoin mining allows the industry to give back energy to the national electricity grid when demand is too high. In July, industrial miners in Texas collectively powered down to assist in protecting the grid during a heatwave as part of a state-wide demand response program.

Such reactivity will be especially important in the coming years as the world increasingly transitions from flexible fossil fuels to non-flexible renewables. Thanks to proof of work consensus powering crypto mining, renewable energy sources are becoming profitable through leveraging the portability, modularity, and agnosticism of Bitcoin miners.

Lastly, besides supporting renewable energy, crypto miners have also begun to help make oil drilling a cleaner and more efficient process.

Oil drilling normally produces natural gas that cannot always be economically harnessed for consumption. Such natural gas is beginning to become useful for crypto mining. This, therefore, helps oil companies such as Exxon, Chevron, Saudi Aramco, and Gazprom, among others, to make profits through Bitcoin mining and also reduce the greenhouse gas emissions associated with the byproduct.

Over recent years, Oil field Bitcoin mining has been growing fast, especially in the United States and Canada.

In March, Exxon, a major US multinational oil and gas corporation, announced plans to use Bitcoin mining for this purpose.

The crypto economy has demonstrated that it is here to stay, as a variety of interesting new areas for investments in the industry remain constantly evolving. Crypto mining is one such avenue for business profitability.

The rapid growth of the crypto economy is not only placing fresh demands on but also offering new hopes for electricity grids. Crypto mining offers energy firms new opportunities to create new revenue streams, improve demand response, and accelerate the expansion of the long-term renewable resource base.

Ethereum Energy consumption, Carbon Footprint Reduce 99.99% after Merge

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The Crypto Carbon Ratings Institute (CCRI), a research-driven institution providing carbon estimates for investments in cryptocurrencies and technologies, has issued a report showing that Ethereum Merge, which was successfully completed last night, has drastically reduced the blockchain network’s overall energy consumption.

According to the report issued on Thursday September 15, Ethereum’s energy usage and carbon footprint have both dropped even more than anticipated after the Merger upgrade.

The report said Ethereum now uses approximately 99.99% less energy after the merge was completed. It further mentioned that the blockchain’s carbon footprint has also fallen by over 99.99%.

In the past, the Ethereum Foundation estimated that the merge would cut the network’s energy consumption by approximately 99.95%.

The CCRI report disclosed that Ethereum’s overall electricity consumes just 2,600-megawatt hours per year, compared to 23 million megawatt hours before the merge. As a result, Ethereum’s estimated annual CO2 emissions have fallen from over 11 million tons to just under 870 —less than the combined total of 100 average American homes, per the U.S. Environmental Protection Agency (EPA).

In a statement yesterday, Uli Gallersdörfer, CCRI co-founder and CEO, said that Ethereum’s “green credentials” are now at par with other energy-efficient blockchain networks that started with a proof-of-stake consensus model, rather than transitioning to it as Ethereum just did.

However, Ethereum’s move to proof of stake (PoS) consensus model has not gone well with some industry stakeholders. Ethereum miners, who used to run powerful computers to secure the network and earn ETH rewards through mining, have moved on to mine cryptocurrency on other networks.

Miners have moved their powerful rigs to other blockchain networks like Ethereum Classic (ETC), Ravencoin (RVN), and Ergo (ERG) to do mining.

Why the Merge Is Important

Ethereum’s switch to proof of stake has been planned since 2014, before the official deployment of the blockchain. Due to its technical complexity and the increasingly large amount of money at risk, the upgrade has been delayed several times.

The Merge is part of what in the past was called “Ether 2.0,” a series of upgrades that reshape the blockchain’s foundations.

The move, known as “the Merge,” is of huge consequence. The major network upgrade, which saw Ethereum transition from PoW to PoS, was designed to address concerns about its environmental impact, dramatically improve its transaction speed, and boost the value of Ethereum, among other improvements.

Image source: Shutterstrock