Leading Crypto service comparison site Cryptowisser, announces its Crypto Carbon Footprint list. The list ranks how sustainable the top 100 cryptocurrencies are and is based on the research of a Swedish team of sustainability experts.
The list ranks each coin of how a typical transaction affects the environment through its carbon footprint. The list uses a color scheme to display different levels of energy efficiency and carbon footprint, with dark green being the cleanest by carbon neutral or negative, and medium green being equivalent to a VISA transaction.
“We are excited to release the world’s first comprehensive ranking of carbon footprints of Cryptos and we hope to give more clarity in the market regarding how green different cryptos are. Based on our research, we can also give a positive outlook for the sustainability of Crypto”
Richard Ramberg, CEO of Dgtl Assets Group AB
How Does Crypto Have a Carbon Footprint?
The carbon footprint of cryptocurrency is based on the energy consumption from the daily operations, for example the process of mining or running of nodes in combination with how clean the energy is. Miners powered by renewables or based in a clean electricity grid will have a significantly lower carbon footprint than if powered by fossil fuels.
How many Cryptocurrencies are carbon neutral or negative?
According to the list, 12 of the cryptocurrencies are self-defined as carbon neutral or negative with Algorand taking the top spot as the greenest cryptocurrency on the market.
The vast majority of the coins have been ranked in the Light Green category, which means that most of the top 100 cryptocurrencies do have a relatively low carbon footprint.
From the data found, there are only a minority of coins that have a high carbon footprint, a positive outlook for the sustainable future of crypto, further reinforced by the current trend of even greener cryptos.
Proof of Stake or Proof of Work?
The energy consumption of the Cryptos depends primarily on the mechanism/consensus algorithm used for a block of transactions to be added to a Cryptocurrency’s digital ledger, so called blockchain, in combination with the energy efficiency of the equipment that is performing the algorithms.
The most common types are either Proof of Work (PoW) or Proof of Stake (PoS), while they have similarities, they differ in how they execute a transaction, where typically a Proof of Work transaction consumes about 1000 times the energy compared to a Proof of Stake transaction. As shown in the list, the coins associated with Proof of Stake occupy the top of the list being more carbon friendly, while most Proof of Work coins are less carbon friendly, but exceptions do exist.
A carbon neutral or negative crypto world does not seem unachievable at all, even if the process of third party verification and “Proof of Green” need to accelerate. Most cryptocurrency transactions are similar to a VISA transaction in terms of carbon emissions; however, the two top cryptocurrencies (BTC and ETH) do have work to do to become more energy efficient and sustainable.