This was surprising, in part, because Musk is considered a crypto enthusiast and the company just started accepting BTC in February, but also because Bitcoin’s massive energy demands are well established.According to Digiconomist, the entire Bitcoin mining industry has a carbon footprint comparable to that of Singapore, due to the immense energy consumption of powerful platforms that solve the complex equations required to produce new blocks. Some backers, such as Twitter CEO Jack Dorsey, suggest Bitcoin mining “encourages renewable energy” – and Musk has previously agreed.
Now, however, Musk says Tesla is “concerned about the rapid increase in the use of fossil fuels” for mining. According to its tweet, the company is looking for alternative cryptocurrencies that use much less energy than Bitcoin’s network. The price of Bitcoin fell more than 13% in the wake of the news.
Tesla’s announcement could cause some people to question their Bitcoin investments, and not all cryptocurrencies use the same type of resource-intensive model to produce blocks and validate transactions. Here’s a look at five other popular cryptocurrencies that take a greener approach than Bitcoin.
Explicitly billed as an eco-friendly currency, Nano (NANO) has no “mining, typing, or printing” and uses a lightweight proof-of-work model, which would only take seconds to process a transaction on a PC. typical general public.
Without the need for robust mining rigs and high-end GPUs, Nano is touted as a cleaner alternative to Bitcoin and Ethereum. In the wake of Tesla’s announcement, investors are buying the argument: The price of NANO has nearly doubled in the past 24 hours.
The newly launched Chia, created by BitTorrent inventor Bram Cohen, puts a twist on the familiar proof-of-work formula. Its “proof of space and time” model uses your computer’s storage space to make “plots” of cryptographic numbers and “mine” them as the network operates.
This is one of the hottest new parts to mine, given that you don’t need an expensive, high-powered GPU to participate, but beware: Chia farming might burn some consumer SSDs out. entry level in a few weeks.
Created by Charles Hoskinson, co-founder of Ethereum, Cardano has skyrocketed in 2021, increasing more than 10 times its price since the start of the year and hitting a new all-time high yesterday (May 13) of $ 1.96 . It is currently the 5th most valuable cryptocurrency, according to CoinMarketCap, ranked by total market cap.
The blockchain network is based on peer-reviewed research and relies on a proof-of-stake consensus model, in which participants hold the ADA coin within the network and receive rewards accordingly. Hoskinson claims that the entire network uses only 6 GWh of energy per year, a tiny fraction of what Bitcoin consumes. Cardano is now actively courting Tesla to adopt ADA on BTC.
Like Cardano, Polkadot came from another Ethereum co-founder (Gavin Wood), who decided to try a different approach. Polkadot has also gained in value so far this year, nearly five times its price since the start of 2021, and is one of the top 10 cryptocurrency players by market cap.
Polkadot is designed as a multi-chain network that can bridge the gap between different blockchains and is based on a nominated Proof of Stake (NPoS) model based on holding coins in the network, rather than heavy mining. energetic.
Stellar Lumens (XLM) is another long-established cryptocurrency that has benefited from the market-wide gains of 2021, whose value has increased nearly five times since the start of the year.
XLM’s unique consensus model for transaction validation is power efficient, requiring only a small number of distributed nodes to confirm them. As such, XLM does not have the huge energy needs of some blockchain networks, which could explain why it is being exploited for large projects – for example, Ukraine plans to build its national digital currency on the XLM technology.
Disclosure: The author of this story held less than 1 BTC and less than 700 ADA at the time of publication.