Greenpeace USA has joined with the CEO and cofounder of (the company behind XRP cryptocurrency) to push for a code overhaul to address its environmental impacts.

While changing Bitcoin so that it consumes less energy might sound appealing, what additional benefits could that have for the network?

Campaign for PoS Change

The initiative, called “Change the Code, Not the Climate,” is running advertisements in major media outlets and publications such as the New York Times, Politico, and The Wall Street Journal in order to persuade the Bitcoin community to modify the network’s existing code.

Bitcoin is currently running on the Proof of Work (PoW), consensus algorithm. It requires miners solving complex problems to validate transactions, and to issue new currency. Some campaigners advocate a switch to the more energy-efficient Proof of Stake (PoS), which is being promoted by many.

The campaign’s head Michael Brune said that they are involved in the campaign over the long-term. However, it is important that the leaders of Bitcoin are compelled to acknowledge that climate change is an issue.
Switching to Proof of Stake could result in Bitcoin’s energy use being cut by 99%, according to some estimates. Bitcoin’s major rival, , the industry’s second-largest cryptocurrency, is already making the switch to the algorithm to make it lighter and more climate-friendly. It also proves that this switch can be implemented.

With Ethereum evolving, Bitcoin is now the exception. When speaking with Bloomberg, Chris Larsen, CEO and cofounder of Ripple highlighted that some of the more recent protocols, such as, are built on low-energy.
Along with Russia and China, the U.S. is one of the most important crypto-mining countries. Some U.S. communities are experiencing increasing frustration after hosting Bitcoin miners. Many miners relocated to America after China ban crypto mining.

Consumption of Electricity

The Cambridge Bitcoin Electricity Consumption Index estimates that the Bitcoin network consumes approximately 136 Terawatt-hours of electricity per year, which is more than whole countries such as Norway or Ukraine. Bitcoin’s share of the world’s total yearly electricity consumption is 0.68 %, and this figure has increased almost tenfold in the past five years alone.

Although the Bitcoin network consumes a lot of electricity, there are still other options. Bitcoin mining can be done almost anywhere.

As a result, Bitcoin miners can tap into so-called ‘stranded’ energy assets that cannot easily be put to productive use by other industries. Bitcoin miners don’t compete against other industries, residential users, or for the same resources. They instead absorb excess energy that could otherwise be wasted or lost. T&D electricity losses in the USA reach 206 TWh, which could power the entire Bitcoin network 1.5 times.

A solution for the rising electricity needs would be to look into renewable energy options. Miners are also in constant search of cheap energy. Renewable sources can often be found to be cheaper.

The Bitcoin Mining Council presented research results from 2021 on more than 32% participants in the global Bitcoin network. They found that they were using 67% of the sustainable power mix. This data suggests that Bitcoin mining could have a total of 56% sustainable power mix, which makes it one of the most environmentally-friendly global industries.

What is Bitcoin’s need for PoS? Oder is It..

The Ethereum network’s switch to PoS seems to have laid the path for Bitcoin. Both networks however have different profile. Ethereum needed to find ways to make its network faster and lighter, since its main purpose was to be a smart contract platform. It needs high-speed internet to process complicated transactions.

On the other hand, Bitcoin doesn’t make smart contracts, and the asset’s price and supply have given it a role as a reserve currency. It already addresses the issues of congestion and scaling by adding the lightning network.

The miner community, as well as investors, remains skeptical about the possibility of changing Bitcoin’s consensus model. Jason Deane (NASDAQ: Quantum Economics’ chief Bitcoin analyst) explained to Yahoo Finance how removing Proof of Work would remove Bitcoin’s essence and make it useless.

The value that Bitcoin has is in its linking with thermodynamic laws and money are well understood by miners. This aspect of the system is no longer independent, and the “low-energy” alternative doesn’t offer security or independence.
This complex problem also includes other issues. Despite the impressive environmental credentials of PoS due to its energy efficiency and other factors, Proof of Work has not yet proven the same approach.

Ethereum (Proof of Work) and Bitcoin are the only two blockchains that have reached mainstream adoption. Blockchain.com’s head of research Garrick Hileman explained that Proof of Work is only consensus algorithm which has been tested at large scale. It also safely stores over $1 trillion worth of Bitcoin value.
The tendency of Proof-of-Stake is toward centralization. Moving from PoW could expose BTC for unnecessary centralization risk. In practice, there is no limit to the amount of crypto any validator can stake on certain Proof of Stake currencies. PoS systems could evolve into a system with a handful of stakeholders, similar to traditional financial systems.

On the other hand, though PoW is considered decentralized, Bitcoin has three mining pools controlling almost 50% of the Bitcoin network’s computational power. It is also expensive to mine individual coins, but it is mostly being done by large industrial companies. PoS is significantly safer from 51% attack.

Rivalry?

Larsen denied that the “Change the Code, Not the Climate” campaign is anti-Bitcoin.

Bitcoin is a potential competitor to Bitcoin, so I’d recommend that it keep going on its current path. He stated that this was an inexorable path.
Larsen also revealed that he felt that Bitcoin investors might abandon him if he didn’t make changes. He added that a successful campaign would have both Bitcoin and Ethereum.

However, the motives of the campaign were called into question due to the position of Ripple’s XRP as a rival to Bitcoin, with the head of a major crypto research platform calling Larsen “Judas”. Social media has seen thousands of cryptocurrency enthusiasts express disapproval for the campaign. The Bitcoin community in general considers this unrealistic.

Bitcoin is not controlled by any one person. Therefore, all proposed changes to the blockchain protocol need to be approved and voted upon by everyone. Even if that were to occur, however, it wouldn’t end the existing Proof of Work mining system.

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