Podcast: Can crypto go green?

Cryptocurrency mining has come under scrutiny of late, specifically for the environmental impact of such an energy-intensive practice.

Kathleen Breitman, co-founder and CEO of Tezos, advocates for the less power-hungry proof of stake consensus mechanism as opposed to Bitcoin’s proof of work while Bitgreen CEO Adam Carver thinks mining via renewable energy is another way forward.

While Kathleen thinks proof of stake is the way forward, calling Bitcoin’s proof of work “a gen one technology”, she concedes that “some of the criticisms of Bitcoin as an energy monster are mostly from people who would not find anything virtuous about Bitcoin regardless of how much energy it consumed.”

Time to switch to the next generation of crypto?

So, why is proof of stake gen two? Adam calls out its equitable properties. “The idea here is that proof of stake as a consensus mechanism for securing the blockchain enables and empowers every individual token holder who owns that going to participate in the network security,” he explains.

“And the manner in which you do that is by taking your individual coins, your purse, and you put that into a locked mechanism, you stake yourself in the system and then if you are a law abiding, honest participant, you receive your stake back plus a reward from the network.”

Although Bitcoin continues to dominate, every major blockchain protocol that has launched since 2017 has either launched on a proof of stake mechanism or some hybrid form with almost none are launching on proof of work mechanisms that define the original prototype of Bitcoin, Adam points out.

This may lead eventually to a greener crypto market but for now, he thinks one solution is to shift the grid that mining pools are hooked into towards a clearer, lower emission form of electricity.

Kathleen Breitman, Adam Carver and Laura Wallendal were in conversation with Robert Hackett, senior writer and tech editor at Fortune. This talk is from Web Summit 2021.

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Image: Harry Murphy/Web Summit (CC BY 2.0)