After the concerns raised by Tesla CEO, Elon Musk, about the energy consumption rate of Bitcoin, investors want to know which cryptocurrencies are eco-friendly. Elon Musk stated on May 12, 2021, “We are concerned about the rapid increase of fossil fuels for Bitcoin mining and transactions, especially coal, which has the worst emissions of any fuel.”
These concerns are valid because data from TRG Datacenters show that Bitcoin consumes a whopping 707 KWh per transaction. Let’s put this in perspective:
According to the U.S. Energy Information Administration, the average monthly household electricity consumption is 958 kWh per month. Bitcoin’s transaction volume is currently 263,419 units per day. In a month, Bitcoin transactions will consume an estimated 5,587,116,990 KWh (5.58711699 TWh) of electricity. An alarming amount of energy, lending credence to Elon Musk’s concerns.
A study done by the University of Cambridge estimates Bitcoin’s annual electricity consumption to be more than The Netherlands, United Arab Emirates, and Argentina in 2020.
In the cryptocurrency space, there are several altcoins that consume far less energy than bitcoin and investors will like to know what they are. This list is created based on data from TRG Datacenters.
IOTA is currently trading at $1.30, down from its all-time high by 76.96%. Created in December 2017, IOTA is a distributed ledger that is not a blockchain. Instead, its proprietary technology is known as Tangle, a system of nodes that confirm transactions. Because there’s no blockchain, there are no miners, and because there are no miners, there are no fees. Many established networks see costs balloon when congestion intensifies, but IOTA aims to provide limitless throughput at minimal expense.
IOTA consumes 0.00011 kWh per transaction according to TRG Datacenters. It is the most eco-friendly cryptocurrency although many argue that it is not truly a cryptocurrency because it is not built on blockchain technology.
XRP is currently trading at $1.20 and is down by 16% in the last 24 hours. Ripple’s XRP facilitates cross-border financial payments. This means that Ripple solves the problems that come with sending money to foreign nations. Currently, conventional cross-border financial payments are slow, expensive and require several middlemen who all want a piece of the pie. Ripple’s XRP, on the other hand, is super-fast and can process over 1,500 transactions per second. This is nearly seven times faster than international e-wallets like PayPal.
XRP consumes 0.0079 kWh per transaction according to TRG Datacenters.
CHIA is currently trading at $1030, down by 46% from its all-time high, which was created just 17 days ago. CHIA was incorporated in August 2017 to develop an improved blockchain and smart transaction platform. Chia is the first enterprise-grade digital money and it is using a new Nakamoto consensus algorithm since Bitcoin, called Proof of Space and Time. It was created by Bram Cohen, the best network protocol engineer alive and the inventor of BitTorrent (BTT).
CHIA consumes 0.023 kWh per transaction according to TRG Datacenters.
The meme coin is currently trading at $0.39, currently down by 46% from its all-time high of $0.7376. The cryptocurrency, which was created by two software developers as a joke in less than two hours, is getting approvals from the cryptocurrency community. A milestone achievement for the coin is its listing on Coinbase. It is highly influenced by Elon Musk and it operates on a PoW protocol like Bitcoin.
Dogecoin consumes 0.12 kWh per transaction according to TRG Datacenters.
ADA created an all-time high of $2.46 four days ago. It is currently trading at $1.70, down 30% from its all-time high. Cardano’s star project, ADA, runs on a proof-of-stake (PoS) protocol. PoS is a lot more sustainable than PoW because miners don’t need to solve complex algorithms, and the required processing power is much lower. Cardano aims to rectify the issues that plague other blockchains by offering a network that improves scalability, transaction speeds, and decentralization.
ADA consumes 0.5479 kWh per transaction according to TRG Datacenters.