Vitalik Buterin: Proof-of-Stake reducing ETH’s environmental impact
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According to ETH co-founder Vitalik Buterin, Proof-of-Stake can be a solution to reduce the environmental impact of BTC and cryptocurrencies.
The ETH network was created using Proof-of-Work (PoW), as was BTC, but PoW does not allow the network to scale. Therefore, the decision has been made to move ETH to Proof-of-Stake (PoS), which is expected to happen in the next few months, or at most in the next few years.
In addition to making the network more scalable, with faster and cheaper transactions, PoS also consumes very little energy, compared to the high consumption of PoW.
Speaking during the StartmeupHK virtual festival in Hong Kong Buterin said:
“Proof-of-stake is a solution to the [environmental issues] of BTC—which needs far less resources to maintain”.
The fact that PoS requires fewer energy resources is not in doubt, but the fact that it could be implemented on the BTC protocol is open to question. To date, in fact, there does not seem to be anywhere near the level of consensus needed to replace PoW with any other consensus algorithm on the BTC protocol.
How PoS will reduce ETH’s environmental impact
But if the discussion is extended to the entire crypto ecosystem, excluding BTC, Buterin’s observation makes sense. For other cryptocurrencies, less decentralized than BTC, it is easier to apply changes to the underlying protocol.
For example, according to the ETH Foundation, switching to PoS could reduce ETH’s power consumption by up to 99.95%. When the ETH network will be using PoS, its power consumption could be in the order of 2.62 megawatts, i.e. as much as a small American town with about 2,100 houses. Currently, however, with PoW, the ETH network consumes the energy equivalent of an entire medium-sized country.
However, the upgrade of ETH to PoS is still in its infancy, and far less field-tested than PoW, so much so that Buterin himself admitted that although they thought it would take a year to implement PoS on ETH, they have been working on it for about six years, due to the complexity of building such a model. This is also the reason why ETH’s transition from PoW to PoS is being done very slowly and cautiously.
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