The energy consumption of cryptocurrencies like Bitcoin and Ethereum has raised questions over their impact on the environment. But while Bitcoin is the world’s oldest and biggest cryptocurrency, others are much more energy-efficient.
New research shows that the Avalanche blockchain is the most energy-efficient among most of the biggest blockchain networks around.
The report from the Crypto Carbon Ratings Institute highlighted that the Avalanche blockchain used just 0.0005 percent of the energy used by the Bitcoin blockchain, and 0.0028 percent of the energy used by the Ethereum blockchain.
Cryptocurrencies are one of the most talked-about developments of the past years. While opinions about the digital assets themselves remain starkly divided, the underlying blockchain technology behind them has already started to have considerable real-world use.
The ‘Energy Efficiency and Carbon Footprint of Proof-of-Stake Blockchain Protocols Report’ analysed the energy efficiency and total energy consumption of six proof-of-stake networks — Avalanche (AVAX), Algorand (ALGO), Cardano (ADA), Polkadot (DOT), Tezos (XTZ), and Solana (SOL) — and two proof-of-work networks, Bitcoin and Ethereum.
While Polkadot and Tezos blockchains have lower overall energy consumption than the Avalanche blockchain, Avalanche’s network is more efficient per unit of energy used. The total energy consumption of the studied blockchains are: Polkadot, 70,237 kWh; Tezos, 94,120 kWh; Avalanche, 489,311 kWh; Algorand, 512,671 kWh; Cardano, 598,755 kWh; Solana, 1,967,930 kWh; Ethereum, 17,300,000,000 kWh; and lastly, Bitcoin, 89,780,000,000 kWh.
On the other hand, the “total value locked” (the total value of all financial applications on the blockchain) per unit of electricity used was the highest for the Avalanche blockchain. Avalanche’s TVL per kWh is $18,454, compared to $4,395 per kWh on Solana, $943 per kWh on Tezos, $161 on Algorand, $120 per kWh on Cardano, and $19.18 per kWh for Polkadot, according to data from DeFiLlama.
(Edited by : Shoma Bhattacharjee)
First Published: IST