New Blockchain Tech Slashes Power Use
Changes to a major rival of Bitcoin have reduced energy use by 99 percent. The drop in computer processing for Ethereum has been likened to the amount of electricity used by a "mid-size country."
The change has come after the Ethereum blockchain switched from proof-of-work to proof-of-stake, a sentence that makes little sense to most normal people.
To break it down, a blockchain is a digital list of transactions. The key is that it doesn't exist as a single copy but rather multiple copies across all the computers of all users. In theory at least, this means it can't be edited or falsified without seizing control of more than half the computers involved.
Some uses of blockchain include online contracts and ways to track a production process. For example, a diamond could be tracked from mining to a jeweler selling a ring, proving it isn't the product of unethical trading or conflicts. However, the best known use of blockchain is for recording online payments.
Verify To Win
A blockchain only works properly when each transaction can be quickly and independently verified. The traditional approach to that with "cryptocurrencies" such as Ethereum has been proof-of-work where users are incentivized to verify transactions. That's because they effectively race to be the first to verify a batch of transactions, with the winner rewarded with a unit (or portion of a unit) of the cryptocurrency.
The big problem is that this leads to an arms race with people using huge amounts of processing power across dozens or even hundreds of computers to try to win the race, an approach known as "cryptomining". In some cases, the total amount of electricity used for a single cryptocurrency is estimated as being more than that used by entire countries. To make things worse, most of this energy is "wasted" by people who don't even win the race. (Source: gizmodo.com)
No More Racing
Ethereum has now switched to a verification process called proof-of-stake that removes the race element. In very simplified terms, it means people deposit existing units of cryptocurrency to get the right to carry out verification and earn more units. If they don't correctly complete the verification, they'll forfeit their deposit. The theory is that this approach only requires one computer to carry out a particular verification, with no wasted electricity.
The switch was technically challenging given Ethereum was already established and operational but a new study suggests it was worth the effort. After three months with the new verification process, an independent researcher says the total amount of electricity used for verifications has fallen by 99.84 percent. (Source: bbc.co.uk)
That such an outcome is possible could boost arguments for governments to pressure or even legislate users to mirror the system switch on other cryptocurrency blockchains. However, the decentralized nature of blockchains means its inherently difficult, if not impossible, to regulate their activity.
What's Your Opinion?
Are you surprised such a change could make such a difference? Would you like to see other cryptocurrencies follow suit? Is it possible or desirable for governments to try to tackle the energy use of blockchains?
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Comments
Sounds good, but
Once more we are asked to give up Liberty, Privacy, and Personal Achievement, in order to placate a group of control freaks bent on ruling, or even worse, a group of fanatics worshiping the ground they walk on.
Gentrification
As someone who has no skin in the virtual money game, other than I find the math interesting, this, to me looks like gentrification, where I got mine, and everyone else gets the finger -whether they understand or not.
Say hello to the new boss.
Same as the old boss.
New carrot, same stick
So the amount of electricity used for any given task has been reduced. What does this announcement really try to do? Entice more to get in the game! It was taking so much electricity to get a Monopoly dollar that some were shutting down their operation. This is saying 'Hey, no big power bill anymore! Come and get in on the free money. We're making it a fair playing field.' Gotta keep that pyramid model going.
I think I understand how some of this works in a very simple layman's way. I haven't seen a good flow chart for any particular 'currency' that isn't like a coastal fog day, very vague at the start, very clear and technical in the middle, and then vague again at the end. But the one part I'm missing is WHO and HOW is the entity paying for the calculations being accomplished to pay the miners? How does one say "Hey, I've got some engineering calcs that need to be run. Where do I inject them into the fray? When do I get my results? How do I get invoiced?"