Once upon a time, cryptos were esoteric, but these days these have become mainstream. All over the world, there are 30 crore plus crypto users. With the spread of cryptos, it is time to think about the effects of crypto mining on the environment.

As we already know, Bitcoin is mined by solving complex mathematical puzzles using high-powered computers. These computers consume a lot of electricity. Bitcoin uses proof-of-work mechanism.

It is time to change to environment-friendly proof-of-stake technology. Ethereum started running on two parallel blockchains — a legacy Ethereum Mainnet which uses proof-of-work and Beconchain, a new blockchain that uses proof-of-stake. This happened in December 2020, and Ethreum called it a Merge event. Merge combined Ethereum Mainnet with Beaconchain. In Beconchain, miners pledge an investment in the digital currency before validating a transaction. To validate blocks, they are required to put up stakes with coins. Later, an algorithm selects a validator who gets to add the next block to the blockchain, depending upon the amount of cryptos he or she has staked. It spares the computers from solving mathematical puzzles by power guzzling. Of course, one has to make considerable investment. Moneyed people will have an upper hand. An investor has to invest minimum of 32 ETH to be a validator. As an ETH trades at $1300, there is an investment outlay of $41600. It is an expensive proposition.

Ethereum’s complete switch to a proof of stake makes it an attractive product for environment-conscious people. Its carbon footprint will reduce by 99.95 per cent.

Bitcoin too has reduced its reliance on fossil fuels. However, it is marginal last year. Its energy was derived from fossil fuels to the extent of 65 per cent, and at present it is 62 per cent.

Ethereum has been proactive to address the environmental concerns. Some other cryptos too use less energy-intensive mechanisms. Such currencies are Nano, Solarcoin, Cardano, IOTA. Chia and others.