Here is fun resource, that shows energy consumption of Bitcoin network relative to other metrics: Bitcoin Energy Consumption. For example, as of November 21, 2019, the carbon footprint of Bitcoin was Comparable to the carbon footprint of Denmark. And we are not talking massive scale yet.

Funny thing is that such energy waste is there by design. It is the security mechanism called PoW (Proof of Work). Both Bitcoin and Ethereum, arguably the most popular blockchains, utilize a PoW.

Brief Explanation of Proof of Work

With PoW, miners compete against each other to be the first to solve a mathematical puzzle. Whoever solves it first, gets to propose his version of the “block” to the network, with transactions he chose to include. Everyone else can easily verify that the puzzle was solved correctly, and by following the rules, accept this block as the next one in the chain.

In order to reduce the probability of different miners proposing valid blocks at nearly the same time, the puzzle has to be complex enough to require a lot of computational power, introducing friction. The more miners there are, the more complicated that puzzle becomes, requiring more computational power to solve it, thus more energy wasted.

If you are interested to learn me, here is a more deep explanation of PoW.

Proof of Work is Not The Only Solution

Though PoW proved itself to be effective, as a security mechanism, other solutions are actively explored. Proof of Stake, Delegated Proof of Stake and a bunch of other less famous “proofs”. We may see some of them adopted massively in the near future.

Here are a few sources to help you explore this topic:

Tagion Solution is Different

In Tagion, we don’t use Blockchain, but Hashgraph instead, where there is no mining by design. Hashgraph is a leaderless system, meaning no one in the system chooses which transactions go in the “block”, instead, it is done by a mathematical algorithm and the communication protocol (how nodes talk to each other).

Basically, there is no artificial computational overhead in Hashgraph. It can run on low-end hardware, potentially even on smartphones.

But it’s fair to notice that Hashgraph, in a permissionless environment (when anyone can join without permission), is not secure and requires a layer of security on top, so evil actors can’t stop network to reach consensus.

Tagion Hashgraph moved the security layer from the consensus mechanism itself to the Node Governance, which determines how new Nodes join and serve the Network. We call it Proof-of-People with Reputation Scoring Model, and I will review it in another article soon.

Conclusion

In the end, what we have is an open protocol that is not slowed down artificially, that can scale gracefully both in terms of volume of transactions and amount of nodes. In combination with other optimized solutions, like DART (database) and lean scripting engine, we achieved a truly energy-efficient system design, that will not become energy disaster in the future.