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Push to Increase Blockchain’s Energy Efficiency Gains Momentum

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Blockchain emerged as the foundation for a growing number of corporate and consumer transactions because it is more secure than traditional solutions.  However, the technology is exceedingly complex and chews up a lot of electricity. In response, blockchain vendors are introducing new, energy efficient solutions.

Blockchain technology is an increasingly popular, secure way to build computer software. It gained attention with its first application when the cryptocurrency Bitcoin emerged in 2009. Legacy software was built to run on central computers and does a poor job of securing information in today’s increasingly dispersed technology world.

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Blockchain was made for distributed applications and includes stronger distributed security checkpoints. Traditional systems store information in one location, which is easy to alter. Blockchain stores information chronologically and redundantly on decentralized, synchronized databases, which strengthens security. Transactions are verified only when entered on all databases and not just one. Also, blockchain secures transactions without the involvement of intermediaries, making it difficult for hackers to breach. Therefore, it appeals to utilities, financial service organizations, and consumers.

Since its inception, blockchain gained significant momentum and is now used in a wide range of popular solutions, such as Bitcoin and Ethereum. However, blockchain is processor intensive and consumes an enormous amount of energy.  Ethereum chew up 60 TWh to 125 TWh of electricity annually. Utilities are concerned with climate change and sustainability, so they are concerned with blockchain’s energy consumption.

Increase Blockchain’s Energy Efficiency

New solutions are emerging that address blockchain’s energy shortcomings. An ad group of some of the biggest names in blockchain launched Palm, an emerging alternative that is reportedly 99% more energy efficient than Ethereum. Ethereum and ConsenSys co-founder Joe Lubin; Joe Hage, the owner of Heni Publishing; and David Heyman, the founder of Heyday Films who produced the Harry Potter movies, are among the backers.

In addition, Nifty Gateway, a blockchain software supplier, announced plans to make its solution carbon-negative in the near future. The solution will deploy a new token minting system that utilizes Ethereum’s recent EIP 2309 upgrade. The change is expected to lower the energy used in token creation by as much as 99%.

Blockchain is an intriguing software foundation because it offers utilities as well as other companies the ability to secure complex, distributed transactions. However, the computing architecture is an energy hog. Aware of that limitation, leading blockchain suppliers are developing new solutions that promise to dramatically increase the computing architecture’s energy efficiency.

Paul Korzeniowski's picture
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