What Are Green Cryptocurrencies?
Green cryptocurrencies use fewer resources and energy compared to traditional currencies. Cryptocurrencies are built to have a lower environmental impact and are much friendlier to the ecosystem.
Green cryptocurrencies are those whose mining activities use renewable energy sources. Renewable energies can be such as, for example, solar, wind, and hydroelectric power.
A positive aspect to highlight is that green cryptocurrenciesusually have low transaction fees.Therefore, they will use less additional energy to conduct transactions, whichmakes them more environmentally friendly.
Every day global warming is rising, which means that more and more industries are looking to offset CO2 emissions. This is no different in the cryptocurrency sector, which has gained a negative reputation due to the gigantic energy expenditure generated by Bitcoin.
Therefore, in the next part of this article, you will find certain benefits that green cryptocurrencies can offer in the market.
Eco-Friendly Investment Possibility
Investors interested in being more environmentally friendly are notattracted to invest in cryptocurrenciessuch as Ethereum and Bitcoin as they are not the most environmentally friendly options. However, the emergenc eof eco-friendly cryptocurrencies has become a great investment and development opportunity.
Green cryptocurrencies can be attractive for both the short and longterm. This is possible as these cryptocurrencies often employ forward-thinking technology, meaning their market demand may increase in the coming years.
Slowing Down Global Warming
Green cryptocurrencies are essential as they consistently contribute to slowing down global warming. Because of global warming, glaciers have been melting and therefore sea levels have been rising.
Carbon dioxide emissions are one of the causes that directly contribute to global warming. Crypto projects that decrease CO2 expenditure are vital to combating climate change. However, even though they still consume energy, the projects seek to keep electricity consumption as low as possible.
Cryptocurrencies & Reputation
Cryptocurrencies are essential because they improve the industry's reputation with the media and society. For example, the Bitcoin network has generated negative repercussions in the market because its network requires large amounts of energy, damaging many people's opinions about cryptocurrencies.
However, as sustainable projects become more famous, people's opinions may change and become positive. As a result,some teams behind the most prominent cryptocurrencies have started focusing their schemes on sustainability.
Hive Blockchain Technologies, for example, was the first 100% green cryptocurrency mining company on the market. Their revolutionary model started in 2022 when they dedicated themselves to choosing the location of operation centers where renewable energy optimization is prioritized. As a result, their energy costs are meager in addition to low temperatures and a fast internet connection.
Another company that is using renewable energy for its operations is Green Data Chain. This green Bitcoin mining company based in Spain has a farm with 16 computers powered at all times with renewable energy from animal excrement.
In 2021, DMG Solutions and Argo Blockchain joined forces to create a Bitcoin pool powered by hydroelectric energy.
Both companies are implementing a plan called Terra Pool, which aims to manage Bitcoin's impact on the climate better and have Bitcoins created with clean energy.
The best strategies to know how to invest in green cryptocurrencies
If you are interested in knowing which strategies can allow you to know when and where to invest in the best green cryptocurrencies in the market, keep reading: we will present some strategies to help you find the market's most interesting green cryptocurrencies below.
· Social Networks
Green cryptocurrency projectst end to have sustainability agendas, allowing them to produce high-impact advertising on their social media channels. Moreover, being environmentally friendly projects, they attract the attention of motivated and forward thinking individuals to invest in these projects. Do research, find these channels and stay tuned to be the first to know the news about your favorite green projects!
· Stay On The Cutting Edge Of Technology
Stakeholders tend to identify new projects when there are innovations in the sector. While PoS chains were well known some time ago, new consensus mechanisms that implement improvements in terms of energy consumption have started to emerge. Stay on the cutting edge of technology with a little internet research and networking!
Global warming is on the rise, that’s a fact. This is why many projects have been forced to make changes and become more environmentally friendly. Many projects have opted to make the PoS consensus change and thus spend less energy. For that reason, when you track the market, you can identify which projects are changing and becoming greener and which have not. Make your list and invest on your favorite ones!
· Roadmaps And White Papers
Roadmaps and white papers are two forms of information for stakeholders who want to profit from investing in cryptocurrencies. These sources of information give insight into a company’s plans for the future, giving the possibility to know whether you align with the project’s plan, vision and goals or not.
By reviewing a white paper you’ll be able to know whether a project is green or not. By analyzing this source of information, stakeholders can have an insight into the project's impact on the environment and what measures are being implemented to minimize the effects.
Best Green Cryptos To Invest In The Market
In today's market there are already cryptocurrencies that are dominating green mining. We show them below:
It aims to make blockchain technology much more efficient regarding scalability, sustainability, and interoperability.
Cardano employsa Proof-of-Stake (PoS) algorithm known as Ouroboros. This network seeks to have users purchase tokens before joining to save energy expenditure.
Chia is an exchange platform that uses blockchain technology to create an ecosystem that allows users to exchange their assets efficiently and prioritize sustainability.
Chia was designed to be environmentally friendly. However, its founders discovered the need to create a cryptocurrency that could be mined in a more efficient and energy-efficient way.
This coin is based on blockchain technology, and its goal is the generation of solar electricity in the world. Although it is a cryptocurrency that can be used as a payment method, its main objective is to encourage more clean energy production.
Its founder, Nick Gogerty, sought to create a way to reward companies that promote and support solar energy.
Concerns About Energy Consumption
Cryptocurrencies’ energy expenditure is an issue of concern to both environmental advocates and those interested in this technology. But why?
The fundamental reason is that mining a cryptocurrency equals a need for considerable energy expenditure. This is because it is necessary to do several calculations at once. For example, every time someone makes a transaction with any cryptocurrency, the trades are compiled into blocks to be verified by miners. To verify a block, miners must perform multiple calculations through their devices before adding them to the blocks on the chains. This process is known as proof-of-work.
The more known a cryptocurrency becomes, the more computing power it will use to solve problems, therefore the more energy miners will spend to create more of these cryptocurrencies.
One of the most energy-intensive cryptocurrencies is Bitcoin, as the maintenance of the equipment used for the blockchain requiresa lot of energy, which translates into high carbon emissions. According to a study by the University of Cambridge, Bitcoin spends more energy per year than Argentina and could supply all the water heaters used in the UK for 15 years.
Bitcoin is just one of many traditional cryptocurrencies that have a negative impact on the environment.
In the case of green cryptocurrencies, they do not need to be mined through mathematical calculations, which is one of the reasons why traditional cryptocurrencies consume large amounts of energy. That is why using renewable energy and having low carbon emissions are attractive options for investment, even more so when we are going through a global climate crisis.
Food For Thought
Throughout the article we have defined and mentioned some benefits green cryptocurrencies offer.
Nowadays, climate change is a growing issue, which is why greencryptocurrencies may become the right way to make the cryptocurrency sector more and more environmentally friendly. In this article, we also mention some strategies you can use to stay on top of the best renewable energy projects.
If you desire to invest in cryptocurrencies and blockchain technology we invite you to reach out because at Rather Labs we are ready to help you and make your vision a reality.