Crypto mining may appear to take place in the virtual realm.
But the reality is that the blockchains behind these virtual tokens are maintained by numerous powerful, energy hungry computers.
Take Bitcoin (CRYPTO: BTC), the world’s original crypto, for example.
Bitcoin relies on a proof-of-work (PoW) protocol to verify transactions, which requires a series of miners along the blockchain working in tandem. While the system works, in today’s carbon weary world, the amount of electricity used is mind boggling.
In fact, according to a study by the University of Cambridge, in 2020 Bitcoin used as much energy as all of the Netherlands’ 17 million people. The university also revealed that Bitcoin used almost as much energy as all of the global gold mining activity that year.
But just like corporations are working to green their images and minimise their environmental footprints, so too are a number of pioneering cryptos.
One of the best means for cryptos to go green is to shift from the proof-of-work protocol that Bitcoin still relies on, to what’s known as proof-of-stake (PoS). This sees miners staking some of their own holdings to participate in verification processes. Requiring a lot fewer computers, proof-of-stake has the potential to significantly reduce associated emissions along with reducing overall costs and increasing speeds.
So, which five cryptos are leading the green transition charge?
For insight into that answer, we turn to Coinspot market analyst, Lee Daniels.
World’s number eight crypto greening its credentials
First up, Daniels points to Cardano (CRYPTO: ADA). Currently trading for 45.4 US cents, Cardano has a market cap of US$15.4 billion, making it the eighth biggest token in virtual circulation.
“The digital currency is named after Ada Lovelace, a 19th century mathematician who is recognised as the world’s first computer programmer,” Daniels said.
“Cardano’s PoS blockchain platform has been built with the purpose of igniting the ‘positive change the world needs’,” he added. “Users can utilise ADA as a secure exchange of value and every transaction is recorded under the Cardano blockchain. Cardano works like Ethereum (CRYPTO: ETH), enabling smart contracts and decentralised applications.”
Cardano hit all time highs of US$3.10 on 2 September last year.
ALGO and EOS
Two other cryptos that are spruiking their green credentials are Algorand (CRYPTO: ALGO), and EOS (CRYPTO: EOS).
Algorand, a decentralised blockchain-based network, supports a range of applications.
Currently worth 30.4 US cents, it has a market cap of US$2.1 billion, placing it at number 28 in terms of size.
As for its sustainable nature, Daniels explains:
Algorand was the world’s first pure PoS blockchain. Its network was designed to minimally impact the environment, allowing for faster and cheaper transaction times. Committed to being the greenest blockchain, Algorand is built on an open-source, carbon-negative network and sets the industry standard in sustainability to combat CO2 emissions.
Algorand hit record highs of US$3.28 on 21 June 2019.
As for EOS, it’s “the native cryptocurrency of EOSIO, an open source platform for blockchain innovation and performance”.
EOS is currently trading for 99.2 US cents, with a total market value of just under US$1 billion.
It’s similar to Ethereum, Daniels said, in that it’s a smart platform for the development of decentralised applications:
EOSIO uses a unique consensus model called Delegated Proof-of-Stake model (DPoS), which allows it to process millions of transactions per second. It also features a voting and delegation mechanism that makes the process more democratic, allowing users to spend their coins to vote for various delegates.
EOS hit record highs of US$22.89 on 29 April 2018.
Two other leading cryptos with an eye on the environment
Next up we have IOTA (CRYPTO: MIATA).
Trading for 28.9 US cents, IOTA is the 54th biggest crypto, with a market cap of US$804 million.
IOTA, Daniels said, “is designed for the ‘Internet-of-Things’(IoT), handling payments and other transactions between physical devices that are connected to the internet”.
As for its green credentials, he explained:
IOTA exists to overcome the cost and scalability limitations of blockchain by its proprietary technology called the ‘Tangle’. The Tangle’s data structure consists of a group of data nodes that flows unidirectionally, unlike that of blockchain structure. IOTA is designed to accommodate devices such as sensors that operate in a low-energy environment.
IOTA hit all time highs of US$5.69 on 19 December 2017.
Which brings us to the fifth crypto with a green tinge, Stellar (CRYPTO: XLM).
Stellar is trading for 10.6 US cents and has a current market cap of US$2.7 billion, number 24 on the top-100 list in terms of size.
So what is Stellar and why is it considered a green crypto?
According to Daniels:
Stellar is an open network for storing and saving money. Users can create, send and trade digital representations of all forms of money like USD, peso or Bitcoin.
The software runs across a decentralised, open network and handles millions of transactions each day… Stellar features a unique algorithm called the Stellar Consensus Protocol (SCP), which strives to be highly configurable, faster, and more highly energy efficient than Bitcoin’s PoW method.
Stellar hit all-time highs of 93.8 US cents on 4 January 2018.
Read More:5 cryptos boosting their green credentials in 2022
