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HomeCan Ethereum Blockchain Reduce Energy Consumption As It Introduces Significant Upgrade?

Can Ethereum Blockchain Reduce Energy Consumption As It Introduces Significant Upgrade?


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Ethereum’s blockchain is an open-source infrastructure for building decentralized applications and smart contracts. As the transactions are verified and new blocks are added to the blockchain using a proof-of-work consensus technique, this process can be very computationally intensive. Since the Ethereum network’s popularity has increased, this process’s high energy requirements have become a problem.

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Ethereum’s current energy consumption is worrying because of the negative effects on the environment and the rising transaction fees it causes. A significant upgrade to the Ethereum blockchain is now under development by the Ethereum community to address this problem by decreasing the network’s need for power and increasing its efficiency.

In this article, we’ll take a look at the proposed Ethereum blockchain upgrade and how it plans to cut down on power consumption. The document will also include the potential advantages of the update, its schedule and implementation, as well as its restrictions and obstacles.

The current state of the Ethereum blockchain and its energy consumption

To add new blocks to the Ethereum blockchain and verify transactions, miners must presently solve complicated mathematical problems using the blockchain’s proof-of-work consensus mechanism. Miners need high-powered computers to solve the complex mathematical equations involved in the process, which results in a substantial energy footprint.

A recent analysis by researchers at Cambridge University found that the Ethereum network was using more electricity than Cambodia. This is because there are so many miners working to add new blocks to the blockchain at once, which requires more power.

For a number of reasons, the Ethereum network’s excessive energy usage raises red flags. To begin, it has a major effect on the environment because the energy necessary to run the network comes primarily from nonrenewable resources. As a second point, the significant energy costs associated with mining can make transactions on the Ethereum network pricey, which may slow its widespread adoption.

The Ethereum community is currently developing a significant upgrade to the blockchain with the goals of decreasing energy usage and increasing the network’s general efficiency in order to deal with these problems.

Proposed upgrade to the Ethereum blockchain

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Ethereum 2.0, also known as Serenity, is a name for the blockchain’s planned upgrade. By switching to a proof-of-stake consensus process, it hopes to solve the power consumption problems plaguing the present proof-of-work approach.

An alternative consensus process, proof-of-stake relies on individuals staking their own bitcoin to verify transactions and add new blocks to the network. This saves resources because miners no longer have to do energy-intensive calculations.

Staking ether (ETH) will allow users to earn a return on their investment by participating in the network and doing duties like as transaction verification and block creation when Ethereum 2.0 is released. This would provide an incentive for users to participate in the network and validate transactions while lowering the network’s overall energy consumption.

The introduction of shard chains in Ethereum 2.0 is a major change. Ethereum’s blockchain will be able to scale to a larger number of users and process more transactions concurrently if shard chains are implemented. Therefore, the network’s energy consumption will reduce even further as a result of this.

Timeline and implementation

It is possible that the schedule for releasing Ethereum 2.0 will shift. The Ethereum community has stated that the update will be rolled out in stages, with Phase 0 (the Beacon Chain) scheduled to go live in 2020.

The proof-of-stake mechanism will be introduced with the Beacon Chain, which serves as the foundation of Ethereum 2.0. At this point, participants can begin staking their ether and collecting incentives for helping to verify transactions and add blocks to the network.

The first stage, called Shard Chains, is scheduled to become live in 2021. In this stage, shard chains will be implemented to improve network scalability and for more transactions to be processed concurrently.

The second stage, known as the Execution Environment, is slated to be live sometime after 2022. In this stage, a new virtual machine will be introduced, which will improve the speed with which smart contracts and distributed applications may be executed.

Keep in mind that the Ethereum community is hard at work developing and testing Ethereum 2.0 and that the schedule may shift depending on how things go.

For the upgrade to take effect, Ethereum will undergo a hard split, which will result in the creation of a new blockchain that is completely independent of the old one. The current blockchain will keep running as usual, and users can pick and choose which blockchain they want to utilize. Users and developers alike will need to ensure their tools are compatible with Ethereum’s latest blockchain release.

Potential challenges

Ethereum 2.0 has the potential to introduce new difficulties and constraints, such as the following:

  • Difficulty: The upgrade necessitates a fundamental shift in the way Ethereum is currently being used, which could prove to be a complicated and time-consuming task. Inevitably, this may cause technical problems and implementation setbacks.
  • Low Uptake: Since the upgrade necessitates staking ether, it may not appeal to all users. The network’s upgrade and security depend on the participation of enough users in the staking process.
  • Potential security issues: The upgrade adds a new layer to the Ethereum blockchain and a new consensus mechanism, both of which potentially compromise the integrity of the network.

Current Ethereum dApps may be affected by the upgrade. Developers of decentralised applications (dApps) may need to upgrade their software to work with the latest blockchain. It’s possible that mining activity would drop, which could have an adverse effect on miners’ finances. Users with less financial means may be prevented from joining the network due to the hefty stake required to do so. Possible community fragmentation as a result of the difficulty of persuading the current user base to switch to the new network.


By switching to a proof-of-stake consensus method and incorporating shard chains, Ethereum 2.0 (or Serenity) hopes to solve the scalability and energy consumption problems associated with the present proof-of-work consensus process.

The improvement may potentially make the Ethereum blockchain faster, more secure, and cheaper to operate while simultaneously reducing its carbon footprint and protecting the environment. As the modern age advances this method of low energy consumption without comprising should be adopted by every Ethereum blockchain development company that is providing solutions using scalable technologies. This will help them to checklist crucial sustainable development goals too.

The upgrade will go out in stages, with the debut of the Beacon Chain marking the beginning of the first stage in 2020. A hard fork is being used to implement the upgrade, which means that a new blockchain will be established independently from the current one.

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