Stake mining a greener way to validate the blockchain

Published in El Pais, 17 February 2021.

Bitcoin introduced the most secure network in the word, blockchain, just to give you an idea of what it would take to successfully hack it, you would need to have more than 50% of the total mining power which would take more computing power than anyone can ever imagine. It short, it cannot be done. But this validation comes at a heavy cost, literally. The amount of required power for crypto miners is astronomical, look up mining farms on the internet and you will always see they are placed next to their own power station. As much as I love the blockchain industry, I am well aware it is not very green and with many becoming more environmentally conscious I can understand those who reject it for that very reason. Fortunately, many are coming up with more validation techniques that are more environmentally friendly, with many adopting the Proof of Stake (POS) technique that is not only greener but allows people like you and me to be involved with crypto mining.

POS is a different approach to Proof of Work (POW) that blockchain projects like Bitcoin and Ethereum use to keep their networks secure. I will not go into the technical details of it but the quick explanation is rather than using computing power it uses existing coins to validate and create future coins, sort of like a coin dividend. These blockchains require a small amount of computing power (often just one computer per validator) which means that full warehouses of computers are not needed to keep the blockchain going.

The best part is, as mentioned before, anyone can get involved, the most notable project using this method, Cardano, only requires a few coins (priced at around 80 cents) to mine, one does not even need a computer as you can just lend your coins to a validator who will do the work for you for a small fee. This can also make some potential investors feel easier as one of the biggest arguments against crypto investing is that there is no dividend, this changes that and those that stick around for the highs and lows of crypto investing will be rewarded during this time.

About Matthew Glezos 348 Articles
Matthew is Canadian and has a Master in Business Administration. He has international experience in marketing and strategy. He has a strong interest in technology and combines it with the business side.

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