Thursday, July 29

EMURGO Compares Proof-of-Stake with Proof-of-Work



Blockchain technology company EMURGO has announced that the Proof-of-Stake (PoS) consensus used by Cardano (ADA) provides a “more energy efficient alternative for users and businesses” than Proof-of-Work (PoW).

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EMURGO, which developed the Yoroi wallet for Cardano, spoke of the energy-hungry Bitcoin’s PoW algorithm:

“As the price of Bitcoin rises, more and more people enter the mining race to profit from it. Now, as the number of miners grows, the network needs a way to stabilize the flow and ensure conditions remain stable. To do this, mining difficulty comes into play in Bitcoin’s PoW algorithm. Miners need to complete more difficult calculations to get their Bitcoin rewards. These calculations require more powerful hardware and subsequently more energy usage. Bitcoin’s difficulty has continued to climb steadily over the years. Even more electricity will need to be used in the future to keep the Bitcoin network secure. Today, Bitcoin uses about 121 terawatt-hours of electricity.”

In the continuation of its blog post, the company talked about two main advantages of PoS over PoW:

“The hardware requirements to be a validator in PoS are much cheaper than a miner in PoW. Modest hardware requirements in PoS consume 1,900 kWh per year. It is far from the demanding electricity consumption required by PoW mining farms.”

EMURGO also states that PoS, which is also used by Cardano, is sustainable because its electricity investment is lower. He also states that a full PoS blockchain can be fully secured using 1/10 or even 1/10.