Ethereum completes “merging” that reduces blockchain’s energy consumption

Company news Digital

By Chris Cooke | Published Friday 16 September 2022

The long-awaited upgrade to the Ethereum blockchain, which makes the way it all works much more energy efficient, is now complete. As most music NFT ventures to date have used Ethereum – or so-called sidechains linked to Ethereum – it is an important development, given the many environmental concerns that have been raised about blockchain-based products and services.

The upgrade, often referred to as the “merger,” changes the way new transactions are verified on the Ethereum blockchain, moving the system from a “proof of work” to a “proof of stake” system. The Verge explains the difference in this article here.

But the key point is that the change greatly reduces the energy required to run the blockchain. By more than 99%. In fact, an organization called the Crypto Carbon Ratings Institute estimates that energy consumption will drop by 99.988%.

As for what that means in more practical terms, CCRI says in a new report that the grid will go from using about 23 million megawatt-hours per year to just over 2,600 megawatt-hours per year, which CCRI estimates is “slightly less than the amount of energy 100 homes in the United States would use within a year”. This means that carbon dioxide emissions caused by the operation of Ethereum will drop from around eleven million tons to around 870 tons

Now, that report was commissioned by ConsenSys, an Ethereum software company founded by Ethereum co-founder Joseph Lubin. But other analysts have made similar predictions about the impact the “merger” will have on the blockchain’s energy consumption.

Completion of the shift to the new system was confirmed on Twitter yesterday by Ethereum’s inventor Vitalik Buterin. He wrote: “And we finished! Glad to merge all. This is a big moment for the Ethereum ecosystem. Everyone who helped make the merger happen should feel very proud today.”

While it’s still unclear how blockchains in general—and the non-fungible tokens that can be minted on the blockchain—will affect the music industry in the long term, it seems the impact will be significant one way or another.

And of course, many startups are currently collaborating with artists, labels and others in the music community on various music-based products and services that use blockchain technologies and NFTs.

However, much of that activity has raised concerns in parts of the music community due to the widely documented environmental issues regarding the energy consumption involved in operating a blockchain. And for those artists who are particularly vocal about climate change, engaging in NFT projects has been something of a PR challenge as a result.

Blockchain and NFT enthusiasts in the music community will hope that – while minting NFTs clearly still consumes more energy than simply not minting NFTs – the climate-based backlash to such activity may slow down a bit. And after all, everything we do digitally with content uses some energy. Including you reading this article. You are destroying the climate!