According to a study by the University of Cambridge, Bitcoin uses around 115.85 terawatt hours (TWh) of energy per year. This is more than the energy consumption of some small countries such as the Netherlands or New Zealand.
In comparison, Cardano, a cryptocurrency that uses the POS protocol, only uses around 6 gigawatt hours (GWh) of energy per year. This is a reduction of more than 99%.
So if Bitcoin were to switch to POS, it could save a significant amount of energy. It is estimated that this could save up to 115.79 TWh of energy per year, equivalent to the CO2 emissions of 29 million cars.
However, it is important to note that energy savings at the POS depend on a number of factors, such as: B. the network size, the transaction rate and the energy price. In general, POS is expected to be significantly more energy efficient than PoW.
Additionally, switching to POS could have other environmental benefits, such as reducing air and water pollution. It could also help encourage greater use of renewable energy. If you are interested in starting your journey into the world of Bitcoin and other cryptocurrencies, a platform like Immediate Smarter can be a good place to start.
In conclusion, the move to POS could have a significant impact on Bitcoin's energy consumption. This could reduce grid energy consumption by more than 99%, equivalent to the CO2 emissions of 29 million cars.
Why doesn't Bitcoin switch to POS?
For a number of technical and political reasons.
Technical reasons
- The difficulty of consensus. The consensus in Bitcoin is based on a Proof-of-Work (PoW) protocol. In this protocol, miners compete with each other to solve complex mathematical problems. The first miner to solve the problem wins a block reward, which includes new Bitcoins and transaction fees for the transactions included in the block.
PoW consensus is a secure and robust mechanism, but also very energy intensive. Miners use large amounts of energy to solve mathematical problems, causing large amounts of carbon emissions.
Moving to POS would require a fundamental change to the Bitcoin consensus protocol. This would be a complex and risky process, and it is unclear whether it would be possible to carry it out in a way that preserves the security and decentralization of Bitcoin.
- The need for security. Bitcoin is a decentralized digital currency, meaning it is not controlled by any government or financial institution. This makes it attractive for people who want to protect their finances from government interference.
PoW consensus is a mechanism that helps protect Bitcoin’s decentralization. Miners participating in the PoW consensus have an incentive to protect the network because if the network were hacked, their investments in mining equipment would be lost.
The move to POS could weaken Bitcoin's security as validator nodes would not have the same incentive to protect the network.
Political reasons
- The resistance of the miners. Miners are the actors who benefit the most from the PoW protocol. They receive rewards for solving math problems, which provides them with a significant source of income.
Switching to POS would reduce miners' rewards, which could lead to significant resistance from miners.
- The resistance of Bitcoin supporters. There is a group of people who believe that Bitcoin should stay true to its original principles, which include PoW consensus and decentralization.
These advocates believe that switching to POS would represent a departure from these principles and may oppose the change.
In summary, there are a number of reasons why Bitcoin is not moving to POS. These reasons include the difficulty of reaching consensus, the need for security, and resistance from miners and Bitcoin advocates.
