Cryptocurrency ethereum plans to cut carbon emissions by 99% with upgrade | Cryptocurrencies
Ethereum, the second-largest cryptocurrency, will complete a plan to reduce its carbon emissions by more than 99% over the next month, the foundation that controls the platform has confirmed.
The project, called “the merge”, will result in ethereum switching the underlying technology it uses to validate crypto transactions to a new process that requires less energy to manage.
Once completed, the merger will end the role of “miners” in the ethereum ecosystem, helping to dramatically reduce power consumption. These users run massive amounts of powerful, purpose-built technology all day, every day, to generate random numbers that affect the security of the overall network.
The energy consumption of ethereum mining is currently estimated at around 72 terawatt hours a year, according to Alex de Vries, a Dutch economist who runs the website Digiconomist. It can be compared to the electricity consumption in Colombia, with a carbon footprint equivalent to that of Switzerland.
The transition will see the platform move away from a “proof of work” process, which requires cryptocurrency miners to generate random numbers to verify records stored on the blockchain – the technology that underpins digital currencies such as ethereum and the more popular bitcoin.
Ethereum will instead use a “proof of stake” process, where the network will be secured by users who “stake” the sum of the cryptocurrency, committing to act honestly at the risk of losing it.
De Vries said the switch would eliminate the majority of electricity consumption. “They can cut off a large part of the electricity demand. I will work on quantifying it more precisely, but at least 99% (probably even 99.9%) reduction should be achievable. This means that the electricity consumption of a country like Portugal ( a quarter of all data centers in the world combined) disappear overnight.”
The proof-of-stake model is currently being used on an experimental “beacon” blockchain, where it is being tested to ensure that the theoretical security it provides is sufficient for the multibillion-dollar economy that sits on top of the ethereum network. Now the experimental blockchain will take over the work of the main network.
“Imagine ethereum as a spaceship not quite ready for interstellar travel,” the ethereum foundation said, explaining the merger. “With the beacon chain, the community has built a new engine and a hardened hull. After extensive testing, it’s almost time to replace the new engine with the old mid-flight. This will merge the new, more efficient engine into the existing ship , ready to put in some serious light years and take on the universe.”
There are still potential problems ahead. The foundation said users needed to watch out for an increase in fraud activity because hackers could take advantage of the confusion surrounding the transition to try to trick users into giving up their passwords, their money or both. “You should be on the lookout for scams trying to take advantage of users during this transition,” the organization said. “Do not send ETH anywhere in an attempt to ‘upgrade to ETH2’. There is no ETH2 token and there is nothing more you need to do for your money to remain safe.”
The final stages of the merger are expected to begin on September 6, the foundation said, with the old blockchain shut down sometime between September 10 and 20.
Ethereum will not be the first network to use proof of stake, and others including cardano and solana have demonstrated the technology on a smaller scale. But the move will see bitcoin, the largest cryptocurrency, face renewed criticism for its continued reliance on proof-of-work.
The Bitcoin network uses 130TWh of electricity a year, De Vries estimates, a sum that will become increasingly difficult to defend if the ethereum blockchain shows that the same properties can be achieved in an environmentally friendly way.
