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Most people do not stop to think about how green cryptocurrencies are. It is more or less natural because coins that exist only as bits on the Internet do not suggest any kind of obvious ecological impact in the real world. Before talking about Ripple's XRP, let's take Bitcoin, the mother of all coins, as an example. It is green?
Use more than $ 300,000 USD of electricity per day. According to some estimates, Bitcoin is burning as much energy as Ireland every year, and this is only a third of the entire cryptosphere. How does it happen?
The creation of blocks for the Bitcoin blockchain requires the resolution of a complex mathematical problem called a SHA-256 collision. This problem is so complex that normal personal computers can not handle it fast enough to support the network. That's why the most serious miners use custom hardware to do this calculation. The calculation is very intensive from the processor and requires energy. Much energy. Every mining machine is 100% every day, every week, every month.
This is not all. Over time, the Bitcoin protocol is designed to do two things: increase the level of difficulty in computing SHA-256 and produce half the coins per block. In the beginning, each new block produced 50 new bitcoins.
After two halves in 9 years, the blocks produce 12.5 coins at the moment and by May 2020 the number will drop to 6.25. If you put both things together, it means that when Bitcoin gets older, it takes a lot more energy to produce less blocks and coins. And the network is already aspiring a huge amount of energy.
The idea behind the protocol is to ensure that bitcoins are not only limited, but also scarce, so that there is no inflationary pressure on the token.
SAP: Blockchain & # 39; s Energy Crisis
I Great example of XRP efficiency
Become green with #Ripple & #XRP pic.twitter.com/DZhs5xE0iq
– (@BankXRP) November 28, 2018
Is it worth it, though? Well, it depends. From the point of view of maintaining the Bitcoin network, it is worth 100%. But if you are a miner you must profit from your activity and this depends a lot on the price of the token. According to some estimates, it takes $ 7,000.00 for electricity to produce a single Bitcoin, but this varies widely depending on the country you live in because the cost of power is very different everywhere. But at the current price of Bitcoin (just over $ 4k), many miners from around the world are suffering losses. At least until the price still exceeds $ 7,000.
All this raises a question, can Bitcoin really become the currency of the future if it is not green? And if not, what other options do we have?
There is good news about it. We have the 3.0 blockchain. In many of these projects all tokens were pre-extracted before being placed on the market, so energy expenditure is not as high because it was used only to keep the network nodes online; also because the production of blocks in these new blockchains is not even remotely as complex as in Bitcoin.
The boy's currency of posters when it comes to being green is probably choppy because its consensus mechanism is relatively light and all XRP tokens already exist. And this is not an "exotic" currency. Currently, it is the world's second largest market capitalization and some daring observers believe it is the only currency that really has the potential to give Bitcoin a run for its money in the future.
So you want to be in the cryptosphere and take care of your planet at the same time? So the Ripple XRP is a good option.
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Disclaimer: this article should not be taken as, and is not intended to provide, investment advice. Global Coin Report and its affiliated companies, employees, writers and subcontractors are cryptocurrency investors and may from time to time have holdings in some of the coins or tokens they cover. Please conduct your own in-depth research before investing in any cryptocurrency and read our full disclaimer.
Image courtesy of Pixabay.
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