Cryptocurrencies are scrutinized for their impact on the environment, with Bitcoin rightly taking most of the blame. Following concerns about the trajectory of environmental degradation and climate change, this development doesn’t come as a surprise.
But little known to many, some cryptocurrencies fall on the opposite side of the debate, offering solutions that promote a better environment. These greener alternatives are great options for crypto users who advocate for the environment.
With an average of 0.000003 kWh per transaction, Hedera is one of the most sustainable public networks, 3,300x more efficient than Ethereum, according to a blockchain energy report by the University College London. Organizations can build and deploy sustainable solutions by leveraging Hedera’s low-energy network while minimizing their carbon footprint. This has especially attracted startups and organizations developing the next generation of Environmental, Social, and Governance Solutions.
But beyond its energy-efficient design, Hedera leverages technology and its network to enable fair carbon offsetting markets and facilitate the creation and exchange of climate assets allowing organizations to mint carbon offset tokens at great rates. In addition, the Hedera Consensus Service facilitates the creation of decentralized auditable data logs that are time-stamped and immutable, which enhances trust and transparency in sustainability data.
Hedera, therefore actively contributes to the environment through its commitment to staying as one of the most sustainable networks in the industry, providing energy-efficient infrastructure for similarly mission-orientated organizations and fostering transparency.
As another low-energy consumption network designed to operate in low-tech devices, IOTA uses innovative solutions to address environmental problems. The IOTA Tangle, in particular, an immutable data record that stores environmental data, empowers organizations to create-evidence based policy interventions and better manage natural resources.
Moreover, IOTA collaborates with diverse stakeholders, including industries, civil society, and governments, to build collaborative platforms to preserve critical ecosystems and fight against climate change. For instance, its partnership with Climate CHECK in 2020 led to the formation of DigitalMRV with the mission to stop greenwashing and support a wide range of environmental protection initiatives.
Generally, IOTA’s innovative approach to distributed ledger technology, its focus on inclusivity and low-energy consumption, and its collaborations across sectors position it as a driving force in the quest for environmental betterment.
Relatively new, Chia Network was developed using a unique consensus mechanism known as Proof of Space Time (PoST) which utilizes unused hard drive space rather than computational power. Consequently, it reduces the need for high-energy mining hardware, which in turn leads to less energy consumption, i.e., Chia Network consumes less than 1% of the power used by Bitcoin. In addition, it encourages the use of already existing but idle storage resources.
Chia Network is also actively enabling global cooperation in emissions offsetting. It provides a decentralized, immutable record platform called the Climate Action Data Trust for environmental data storage which ensures integrity and transparency across institutions taking part in carbon markets. It also partners with the International Finance Corporation to establish verifiable ownership of digital carbon assets.
According to CoinDesk, Chia Network offered its technology to Costa Rica’s government to develop a platform to help manage carbon inventory and shift carbon credits with its partner countries.
The Energy Web Token was designed to facilitate the transition of organizations to a more sustainable and decentralized ecosystem for energy-related activities using Web3 technologies. It does this by finding solutions for asset management, data exchange, and Green Proofs. At its core is a mission of powering decarbonization solutions across different countries.
Green Proofs, in particular, help enterprises and organizations to develop verifiable data repositories backing up their public decarbonization promises. For instance, Energy Web launched the Green Proofs of Bitcoin to certify renewable Bitcoin mining, encouraging crypto miners, brokers, and investors to decarbonize Bitcoin actively.
In addition, Energy Web creates demand for clean energy and low-carbon solutions by developing supply chain accounting systems that offer detailed tracking and auditing for clean energy market stakeholders.
Powerledger adopts a unique perspective in contributing to the environment by creating a more responsive market for renewable energy solutions. It develops solutions that enable different groups, including households and organizations, to track, trace, and trade renewable energy. This indirectly reduces reliance on unrenewable energy sources such as fossil fuels.
Over the years, Powerledger has involved multiple countries and collaborated with green energy retailers to promote adopting clean energy solutions. In March 2022, the network partnered with Fenie Energia and Albedo Solar to launch an Energy community project that allows residents to trade locally generated renewable energy in Almocita, Spain. In 2021, the network partnered with BHP to allow local communities in Northern Chile to produce and trade energy.
Through efforts to disrupt traditional energy systems and embrace responsive markets, Powerledger powers the transition of organizations into clean energy. This means they actively contribute to the global transition to environmentally friendly energy.
Another energy-based solution, SunContract, was created to be the intermediary between energy consumers interested in reducing energy costs and energy producers struggling to maximize returns from surplus energy. Its advanced power distribution system integrates households and businesses to contribute to social, economic, and environmental development.
Ideally, it achieves environmental impact by connecting consumers directly with local renewable energy producers, empowering prosumers (individuals that both produce and consume energy), and enabling consumers to choose clean energy options, thus reducing carbon emissions. In addition, the network’s peer-to-peer energy trading system decentralizes the energy grid and enables users to be more active in the energy market.
A practical example of SunContract‘s active involvement in clean energy promotion is the partnership with SONCE Energija and EGING PV to install a solar power plant in an elderly care home, effectively lowering the electricity cost of the home by one-third.
Carboncoin takes environmental restoration to a whole new level by participating in tree planting as a core project besides promoting sustainable practices. It does this by generating funding for planting biodiverse forests across different countries. In addition, it rewards those who support its goals.
While pursuing a greener future, Carboncoin has created numerous opportunities for people to participate in tree planting while demonstrating its commitment to environmental initiatives by holding the network’s largest wallet. In addition, it created the Carbonshopper retail platform to support and promote businesses that meet strict environmental ethics criteria.
Notably, the Carboncoin network doesn’t support Carbon Credits, arguing that they could negatively affect the environment. Instead, they advocate for shifting focus toward planting biodiverse forests.
Environmental Friendliness Is Big for Crypto Projects
Owing to the devastating environmental impact of cryptocurrency mining which has affected crypto adoption, many new projects have devised innovative ways to offer more environmentally friendly solutions.
While some provide platforms that empower institutions and organizations to transition into cleaner energy and sustainable practices, others are at the forefront of sponsoring projects that enhance a greener environment.
Either way, environmental friendliness is a significant consideration in determining which crypto projects well will get warm consumer reception.
