So, how sustainable are eco-friendly cryptocurrencies, and what are their benefits in the real world?
Green cryptocurrency boom
Eco-friendly, or ‘green’ cryptocurrencies exploded into the headlines at the end of 2021 when Elon Musk announced that Tesla would stop accepting payments in Bitcoin due to the environmental impact of mining.
At that time, various leading media outlets have come up with articles on eco-friendly cryptocurrencies. Such publications include:
The Times UK (distributed via Raconteur),
More recently, at the start of 2022 Wikimedia stopped accepting all cryptocurrency donations on the grounds that they “don’t align with the foundation's commitment to environmental sustainability”. Same concerns were expressed by Mozilla who said they will
be “reviewing if and how our current policy on crypto donations fits with our climate goals”.
It’s great that well known organisations are reinforcing environmental principles. However, it is reductive to tar all cryptocurrencies with the same ‘environmentally damaging’ brush. There are a number of innovative virtual currencies that are pushing a
more environmentally conscious agenda - of which nano is the clear leader.
Let’s explore some of these green currencies and assess their viability for immediate adoption.
First, let’s cover the basics.
What is cryptocurrency?
It depends on what you want it to be.
Cryptocurrency is a digital currency, which can be used as a medium for exchange, payment, donation and remittance, designed to circumvent limitations of the traditional banking system. The main
environmental concerns around cryptocurrencies stem from mining: the high amount of electricity needed to power complex algorithms and non-renewable energy sources used for mining. In addition, high transaction costs pose a serious issue for small businesses
that want to explore digital payments.
However, these issues do not apply to all digital currencies.
What is sustainable cryptocurrency?
A sustainable cryptocurrency is one with low energy consumption and minimal carbon footprint. It doesn’t require vast amounts of energy to power its transactions and is constantly working on reducing its environmental impact. The community of such a currency
is dedicated to organizing various eco-initiatives.
And nano can be a perfect example of such a green currency.
There are several factors you need to consider when analyzing if a cryptocurrency can be considered sustainable.
Low energy consumption means it is virtually non-existent. For example, nano transactions
use 0.000112 kWh. Comparison time: with 1 kWh, you can blend 200 smoothies, or binge watch 3 hours of television, or create 10K nano transactions.
To compare this to some of the better known cryptocurrencies, a single
Ethereum transaction consumes circa 178 kWh. To compare, an
average US house uses 30 kWh per day, so 1 ETH transaction equals circa 6 days of electricity consumed by a family.
A single Bitcoin transaction footprint amounts to 1997.16 kWh. This is a lot as it can be compared to the amount of electricity an average family can use for 68 days.
It should be small not due to the transaction number but as a result of the infrastructure. For example, currently just a few hundred machines are needed to power the nano network, as opposed to roughly
70K computers running Bitcoin blockchain software or circa 2K processor contributing to Ethereum.
Activities undertaken both by the foundation and the community of a cryptocurrency matter. Let’s take a look at such projects launched by some of the foundations and communities.
Such is their commitment to environmental wellbeing, the nano foundation and it's thriving community organise a range of green initiatives. For example, a
tree-planting campaign was organised by the nano community ambassador with a focus towards a green and inclusive future.
Examples of sustainable cryptocurrencies:
- Nano (0.000112kWh)
- Hedera (0.001kWh)
- Algorand (0.0002 kWh)
- Cardano (0.5 kWh)
- Chia (2kWh)
As shown in the table above, nano energy consumption is extremely low, fees are non-existent and its speed is lightning-fast. It means that while being a perfect currency which just happens to be digital for business purposes and real-world applications,
nano is also compliant with eco standards of the world we are living in.
What does the future hold?
Digital currency is here to stay, and ethical choices are to be made.
As we are entering the new year, it is important to continue what has been started: adopting crypto payments for businesses all around the world and pursuing eco-friendly initiatives. A way to combine the two would be exploring sustainable cryptocurrencies,
“green” crypto, eco-friendly digital money. Based on the information in this article, nano is the best choice. Its energy consumption is almost non-existent, its carbon footprint is small as a result of a compact infrastructure, and nano transactions are feeless.
Green digital payments are possible for your business: streamline your payments and help the environment!