⚡ Cryptocurrency reduces its energy consumption by over 99 percent
By changing the method of how new crypto coins are created, Ethereum has managed to reduce the blockchain's energy consumption drastically.
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The Ethereum blockchain has implemented a change that requires 99.95 percent less energy to produce new ETH, as its cryptocurrency is called. This means that the total energy consumption to produce new ETH is now 0.01 TWh per year. Before the change, ETH's energy consumption was 112 TWh per year.
For comparison, we can also mention that the Ethereum Foundation, which is behind Ethereum, estimates that the largest cryptocurrency, Bitcoin, has a consumption of 200 TWh per year, while Youtube's servers dispose of 244 TWh each year.
Technically, the change is that Ethereum has gone from being built on proof-of-work to using proof-of-stake.
Simply put, we can say that proof-of-work involves letting computers run algorithms to figure out a huge number. Whoever finds the correct number first gets crypto coins as a reward. To succeed in getting some coins requires enormous calculation capacity, which means lots of computing power which in turn needs a huge amount of electricity.
Proof-of-stake, on the other hand, is based on those who already have ETH "lending out" crypto coins. When new coins are to be created, they are drawn among those who have staked coins before. It drastically reduces the need for computing power to create new coins and makes ETH now significantly more environmentally friendly.
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