The transition of the Ethereum blockchain from a proof-of-work (PoW) consensus layer to a proof-of-stake (PoS) consensus layer was one of the most notable eco-friendly crypto advancements in 2022. The Merge, which was completed in September, combined Ethereum's original execution layer with the Beacon Chain, its new PoS consensus layer.
Allowing the network to be secured with staked Ether completely eradicated the need for energy-intensive mining. The conversion immediately decreased the Ethereum network's energy consumption by 99.9%. The advancement of Ethereum as a leading programmable blockchain signaled an industry-wide shift toward low-carbon-emission solutions.
The co-founder of the Islamic Coin cryptocurrency, Mohammed AlKaff AlHashmi, spoke about how the sector was evolving to meet emerging demands.
"In the case of Haqq [the blockchain that issues Islamic Coin], the protocol automatically deposits 10% of the issued amount into a special Evergreen DAO, a nonprofit virtual foundation focused on long-term sustainability and community impact," AlHashmi said.
Dimitry Mihaylov, chief scientific officer of blockchain gaming metaverse Farcana, said that reducing emissions and on-chain transaction costs would benefit the industry in the long run by attracting users, investors, and governments.
However, in 2022, some unique, innovative, environmentally cryptocurrency projects emerged, contributing to a greener world.
The Chia Network
Chia Network uses a proof-of-space-and-time protocol to reduce carbon emissions, which differs greatly from early energy-intensive crypto-mining methods that require powerful GPUs and processors. The network performs efficient transaction validations, also known as farming, and divides empty computer storage space into user plots.
Farmers provide storage space for the network, which then assigns mining privileges to each miner based on entirely random numbers assigned to each space. Mining privileges are awarded to the storage space whose stored numbers closely match those generated by the network.
This algorithmic formula rewards farmers with the most storage space with a larger allocation of random numbers, increasing their chances of winning.
On the energy front, Chia Network claims to use 0.12% of the Bitcoin network's annualized energy. While the concept is novel, it has some flaws. Mining XCH can wear out the hard disk and solid state drives in as little as 40 days, which has increased demand for hard disk and solid state drives in countries such as China.
Despite this disadvantage, the network has provided revenue-generating opportunities for data storage providers with unused space and businesses with worn but functional data storage hardware that is no longer in active use.
The Algorand blockchain network was designed with the environment in mind, and it has made significant progress toward becoming carbon-negative over the last two years.
In 2021, Algorand will collaborate with ClimateTrade, a company that uses blockchain technology to assist businesses in offsetting their carbon footprint and tracking their emissions in pursuit of broad sustainability goals.
Solana is a blockchain platform for hosting decentralized applications. It validates transactions using the PoS consensus mechanism and adheres to the principles of green token generation. The platform has the potential to process more than 60,000 transactions per second. This outperforms the Bitcoin network, which handles seven transactions per second.
Earlier this year, Solana garnered a favorable carbon rating from the Crypto Carbon Ratings Institute (CCRI) for consuming the least amount of energy at a rate of 0.166 watt-hours per transaction.
Avalanche is a blockchain platform that uses its unique proof-of-stake consensus mechanism to address the blockchain trilemma of scalability, efficiency, and security.
This year, it has been recognized as one of the most energy-efficient chains. According to a CCRI study, the Avalanche public blockchain used about 0.0005% of the energy the Bitcoin network uses, which is quite impressive.
Because of these and other high-efficiency properties, Avalanche has become the platform of choice for projects with environmental concerns.
Eco-friendly cryptocurrency projects' future
Environmentally friendly cryptocurrency projects are here to stay. They are intended to be more environmentally friendly and are gaining popularity among users due to their scalability and lower gas costs.
The advantages they provide will likely lead to the development of more environmentally friendly blockchains and the enhancement of existing ones. However, 2022 marks the beginning of a new era in which green crypto projects become more common.
Do you think that blockchain networks will eventually become more environmentally friendly? Drop your comments by sharing this article on social media.