There’s no getting around the fact that cryptocurrencies have a bad reputation when it comes to their sustainability.
Critics have long argued that the amount of energy that’s required to mine major currencies like Bitcoin is simply unacceptable, monopolizing power and resources which contribute to climate change and hurting the image of the scene at large with eco-conscious consumers.
The good news is that efforts have already been made to reduce the environmental impact of cryptomining, and that over the next decade it will get greener and greener by the year. Let’s look at how exactly this is going to be achieved.
Stringent targets have been set
The biggest sign of crypto’s move towards sustainability comes in the form of the Crypto Climate Accord, otherwise known as the CCA.
This is a project which has already received the support of hundreds of crypto-focused organizations, and which has implemented lofty yet attainable targets for enhancing the sustainability of the industry as a whole.
The first aim is to move all blockchains over to renewable energy sources by the year 2025. The second is to achieve net zero emissions by 2030.
Setting goals and actually reaching them are two different things, of course, but the signs are positive that these could be realistic aims. For example, exchanges like https://swyftx.com/ have already gone carbon neutral, and this is helping to inspire others to follow suit.
Greener currencies are growing in popularity
The main reason that Bitcoin in particular is a bit of a nightmare from a sustainability perspective is that the mining process itself is incredibly intensive, requiring vast computational power and the associated energy costs that come with it to create new blocks on the chain, and also to oversee transactions.
This is the nature of the proof-of-work approach ; one which guarantees a layer of security, but comes at the cost of carbon emissions. Conversely, proof-of-stake is an alternative strategy that has already been implemented by smaller rivals to Bitcoin, and is scheduled to be embraced by its biggest competitor, Ethereum.
With proof-of-stake, mining isn’t needed in its traditional form. Instead, people who hold a given currency can stake it as a means of validating new blocks. This adds a layer of democracy as a means of security, while requiring far less clock cycles to oversee.
Renewable energy is the key
Ultimately it’s impossible for cryptocurrencies to go green without moving away from a reliance on fossil fuels, as noted earlier.
The good news is that there is plenty of support for this shift anyway, and in lots of places it makes sense both from a practical perspective, and also in terms of adhering to the decentralized values that are associated with the crypto movement.
For example, companies like Tesla have started to work on crypto mining facilities which will be fuelled entirely by solar power, with places like Texas proving particularly well suited to this as a result of their climate.
Other projects are helping
The last point to make regarding the eco-friendliness of cryptocurrencies is that lots of organizations have realized that they have to do more than just reduce their emissions from mining; they need to show that they are socially and environmentally responsible on a wider level.
This is why coin creators, exchanges and others in the industry have turned to initiatives as diverse as planting trees to funding charitable causes at home and abroad to improve their image.
There’s still a way to go until crypto is truly sustainable, but like other businesses that want to go green, things are very much moving in the right direction today.