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PoS Vs PoW Electricity Consumption Analysis – Exclusiv...
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PoS Vs PoW Electricity Consumption Analysis – Exclusive.

Electricity consumption per transaction in proof-of-stake networks is two to three orders of magnitude lower than that of bitcoin.

University College London (UCL) analyzed the environmental impact of distributed ledger technology [DLT]. The study showed that the Hedera Hashgraph network has the lowest electricity consumption among seven large blockchains.

  • Experts have evaluated the blockchains Algorand, Cardano, Ethereum 2.0, Hedera Hashgraph, Polkadot, and Tezos. The study also compared Proof-of-Stake and Proof-of-Work technologies in terms of sustainability.

Calculation of electricity consumption by the networks under study. Source: UCL study.
  • The study showed that the electricity consumption per transaction in PoS-based DLT networks is two to three orders of magnitude lower than that of bitcoin.
  • Experts have found that not all Proof-of-Stake networks are created equal, and many of them consume quite a lot of electricity. According to the researchers, this should be taken into account by investors and network users.
  • The study showed that the energy requirements of the protocols depend on the number of active validators. As the scale grows, DLT networks must remain green-focused, experts say.

“The growing popularity of DLT since the invention of bitcoin, and with it the energy-intensive PoW consensus mechanism, has led to the emergence of many alternative mechanisms. PoS is a particularly popular alternative and is generally considered to be more energy efficient than PoW, ”the report says.

  • The technology of the Hedera Hashgraphs network was recognized as the most environmentally efficient among the surveyed. It consumes less energy per transaction than bitcoin and Ethereum. The Hedera Hashgraphs team said the company recently achieved 100% carbon neutrality.

As a reminder, the Ethereum network is in the process of transitioning to a Proof-of-Stake consensus algorithm. Tentatively, the full transition will happen in 2022 or 2023. In August, the network underwent a London hard fork, which aims to reduce volatility and transaction fees.

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