The blockchain protocol is energy intensive. At least that is what many experts claim when they analyze the exponential energy consumption of the Blockchain. Do all blockchains consume as much? Are there alternatives to this exponential energy consumption?
POW POS DPOS, but what is it?
Before tackling the issue of energy consumption of blockchains, we must focus on the creation and operation of cryptocurrencies . Indeed all cryptocurrencies do not have the same type of consensus . This directly affects the energy consumption of their blockchain. Consensus is by definition an agreement and consent of the greatest number . In the world of the Blockchain the consensus corresponds to the type of "Proof" used :
Proof of work, or proof of work in English (POW);
Proof of possession, or proof of stake (POS)
Proof of delegated ownership, or delegate proof of stake (DPOS)
POS or POW system, the creation of corners / token is called " mining " of the term miner. For the DPOS it's called " forging " of the forging term. Note that the type of consensus may need to be modified during the existence of a blockchain.
The proof of work
Created in 1993 , the "proof of work" system deters Denial of Service (DOS) or spam attacks by requiring computing power. It is a difficult system to produce because it is expensive in terms of time and energy , in particular because of the carrying out of super calculations. These super calculations see their difficulty grow as the "mining" cryptocurrency.
Example of cryptocurrencies based on the POW system : Bitcoin , Ethereum , Litecoin ...
The proof of stake
Proof of stake or proof of participation in French, the POS asks the user to prove the possession of a certain amount of cryptocurrency to claim to be able to validate additional blocks of the blockchain and to be able to touch the reward, if there is one, the addition of these blocks. This system makes it possible, among other things, to dissuade the "leakage" of value to fiat currencies, because the more units you have in the cryptocurrency, the more you are able to manage the validation of transactions.
This process relies on participation and the holding of "corners" to validate transactions. This consumes far less energy than a POW system . Nevertheless, POW and POS are chosen on the basis of technical factors for cryptocurrencies before looking at the energy factor .
Example of cryptocurrencies based on the POS system : Peercoin is the first to be based on this consensus. Other implementations have been attempted using various methods including Pivix , BitShares , ShadowCash , Nxt , BlackCoin , NuShares / NuBits and Qora .
The delegated proof of stake
The DPOS is a variant of the POS . In this sense, the foreurs (or delegates , who secure the network ) are not chosen according to their personal "stack", but the counting of votes they count . The votes correspond to the number of cryptocurrency tokens in 1: 1 basis; 1 unit = 1 voting weight. This system significantly reduces the number of active nodes to secure the network, and therefore the consumption of electricity.
Lisk for example, is a cryptocurrency based on the DPOS system . There is a maximum of 101 delegates (forgers) responsible for securing the network. With a maximum of 101 delegates, only the first 101 to have centralized the most votes in the community are allowed to secure the network.
This not only helps to secure the network in a virtually inviolable way (because investors will not vote for anyone), but also to consume less, because Lisk, to name only him, can not have more than 101 forgers , or 101 active nodes maximum . This is equivalent to lower energy consumption compared to a system like POW or POS .
The energy consumption of bitcoin in figures
A lot of research has been done on the energy consumption of Bitcoin. Some researchers have compared the results of their research with the energy consumption of countries or whole households.
This is the case of the comparison site British energy PowerCompare rates which as of November 22, 2017 makes an alarming finding, according to which Bitcoin would have exceeded the energy consumption of 159 countries in 2017 .
The tweet highlights a map of the world that indicates in yellow the countries of the world that consume annually less than Bitcoin.
PowerCompare used data from Digiconomist , which states that the Bitcoin network requires 30.14 terawatt hours (tWh) per year . That's more than the annual electricity consumption of 19 European countries and most African states . In comparison, Ireland is at 25 tWh, Slovakia at 28.3 tWh, and France at 43.1 tWh . They add that in the last month alone, Bitcoin's electricity consumption has increased by 29.98%. If it continues to grow at this rate, Bitcoin mining will consume all of the world's electricity by February 2020 .
The study concluded with an alarming report:
Estimated annualized mining revenue worldwide: US $ 7.2 billion (£ 5.4 billion).
Estimated mining costs worldwide: 1.5 billion USD (1.1 billion GBP).
Number of Americans that could be fueled by bitcoin mining: 2.4 million (more than the Houston population).
Number of Britons that could be powered by Bitcoin mining: 6.1 million (more than the population of Birmingham, Leeds, Sheffield, Manchester, Bradford, Liverpool, Bristol, Croydon, Coventry, Leicester and Nottingham combined). Or Scotland, Wales or Northern Ireland.
Each bitcoin transaction requires as many kilowatt hours as a US home over a week.
Bitcoin mining consumes more electricity than 12 US states (Alaska, Hawaii, Idaho, Maine, Montana, New Hampshire, New Mexico, North Dakota, Rhode Island, South Dakota, Vermont and Wyoming).
Alternatives to this exponential consumption
POS or DPOS systems as a first alternative
Faced with these growing energy challenges, many cryptomania using the POW are thinking of changing their consensus. This is for example the case of Ethereum which intends to change its consensus by switching to POS .
Others like Pivix calculate the consumption of their entire network and compare the results to the energy consumption of Bitcoin.
Comparison of Pivix vs Bitcoin Energy Consumption
According to the Pivix team study , their blockchain with 10,000 complete nodes consumes 35% of the annual energy of a wind turbine , or 15 solar panels. Which for an entire blockchain does not represent much. But the study went further by calculating that it would cost energetically either 10 but 100,000 complete knots pivix . They conclude that only 2 wind turbines or 150 solar panels would be enough to power the entire network. A significant consumption but which remains much less than the current consumption of Bitcoin.
Let's compare the Pivix system (POS) with a DPOS system used for example by the Lisk blockchain . It's not 10,000 or 100,000 knots that Lisk uses , but 101 . This significantly reduces energy consumption without affecting the scalability of the blockchain . Because Lisk is one of the fastest blockchains on the market (about 10 seconds to validate a transaction).
Cryptocurrencies based on the redistribution of energy
Many blockchains focus and develop alternatives only on harvesting, distributing and redistributing energy. In particular, to optimize the treatment of offers and requests for surplus energy.
This is the example of cryptocurrency like:
SolarCoin , launched in 2014, forms a reward system that encourages consumers to switch to solar energy . Companies or individuals with solar panels can receive SolarCoins based on the energy they produce (1 megawatt-hour (MWh) of solar energy entitles to 1 SolarCoin). This project has already rewarded 150,000 MWh of surplus solar energy . This energy surplus has been rewarded by SolarCoins in 24 countries .
ElectriCChain aims to list all solar installations and provide non-confidential climate data. These data can be used for scientific studies.
Electraseed intends to deploy autonomous solar kits, forming their own electrical network and managing all exchanges via blockchain. About a hundred equipments were installed in Africa for a pilot experiment in May 2017. This experiment should lead to the deployment of 100,000 units in 2018.
Power Ledger launched in December "the first residential electricity market powered by a blockchain" . Tested in New Zealand last summer, the device allows solar equipment owners to sell their surplus energy. All exchanges taking place on a dedicated blockchain, Ecochain .
The Brooklyn Microgrid project wants to enable users to locally and independently manage their own power grid, leveraging the Ethereum blockchain to form a "shared and community energy market". Surplus electricity exchanged between neighbors via secure transactions.
Il est évident que Bitcoin, le précurseur des cryptomonnaies est énergivore. Avec un coût de production du Bitcoin qui évolue proportionnellement à la capitalisation totale de Bitcoin, Bitcoin coute cher en énergie. Et cela ne risque pas de s’arranger, car en effet plus le temps passe et plus les calculs de minage sont difficiles. De plus, ces calculs nécessitent la constante acquisition de nouvelles technologies, et de toujours plus d’énergie. Mais rappelons que Bitcoin est la première blockchain créée et la plus ancienne. On pourrait se poser la question de combien coûte la création monétaire mondiale, et quelle quantité de ressources (électricité, pétrole) cela nécessite t-il?
With growing interest and energy redistribution projects, will Blockchain technology reverse the trend in energy consumption ?
