Cardano is more energy efficient than bitcoin, as it uses the proof-of-work mechanism. On Dec. 30, the cardano (ADA) was the sixth cryptocurrency. At $1.36 per token, the ADA’s market capitalization amounted to $45.4 billion.
What are eco-friendly cryptocurrencies?
A green cryptocurrency must maintain the integrity of the blockchain while being energy efficient and reducing the carbon footprint to a minimum. Sustainability is increasingly becoming a central criterion for the future of the blockchain industry.
What is the cryptocurrency that consumes less energy?
Today Ethereum uses the proof of work system. But, it recently announced that it will release its version Eth 2.0, which is based on the proof-of-stake (PoS) algorithm, which requires less energy consumption.
What is the greenest cryptocurrency?
Cardano describes itself as the “most environmentally sustainable” cryptocurrency, thanks to its innovative proof-of-stake blockchain protocol that values the percentage of coins a miner owns rather than the processing power it has.
An hour after Elon Musk announced that Tesla would no longer accept Bitcoin payments, more than a quarter of a trillion dollars were wiped out of the global cryptocurrency market.
The billionaire entrepreneur and cryptocurrency enthusiast cited concerns about Bitcoin’s environmental impact, which had the ripple effect of driving down the price of nearly all of its rivals, with one notable exception.
The Ada cryptocurrency, based on the Cardano platform, not only avoided a price drop, but actually rose 20 percent immediately after Musk’s tweet, before rising to a new all-time high over the weekend above $2.
One reason for this is its underlying technology, which is based on a proof of stake, not a proof of work. This means it doesn’t rely on electricity-intensive computers to process transactions and generate new Ada units.
Cardano describes itself as the “most environmentally sustainable” cryptocurrency, thanks to its innovative proof-of-stake blockchain protocol that values the percentage of coins a miner owns rather than the processing power it has.
Earlier this year, Cardano founder Charles Hoskinson estimated that his network uses less energy than the 0.01 percent of the Bitcoin network. In theory, the proof-of-stake system could achieve more than four million times the energy efficiency of a proof-of-work system, such as Bitcoin’s.
It’s not the only cryptocurrency that uses proof-of-stake or takes into consideration its environmental impact, but it’s easily the largest.
Beyond its climate credentials, Cardano also recently became a fully decentralized community network, meaning its parent company no longer has control over its blockchain. Market analysts claim that this development makes it an attractive proposition for investors.
“Cardano aims to become a global financial computer,” the publication stated. “Is that more than Netflix can offer? Netflix is a streaming service… We believe Cardano can have a bigger impact. Could Cardano be better than Facebook? Facebook is just a social network. Cardano is here for all people who could use decentralized currency and create decentralized services.
“What could be the price of Ada in a few years? If you agree with our comparison of Cardano to tech companies, then it’s pretty easy… It could be huge. Cardano could have a capitalization similar to that of the tech giants.”
In the year and a half since this was written, Cardano has become the fourth most valuable cryptocurrency in the world with a market capitalization in excess of $70 billion. While this may still be a long way from Netflix’s $200 billion valuation, it puts it on par with Chinese tech giant Baidu, and more than the combined value of Dropbox, McAfee antivirus, Slack, and LG Electronics.
The same year the publication was written, Cardano ranked as the “busiest” cryptocurrency ahead of Ethereum, according to a report by market information firm Sentiment, making it the most developed crypto project of 2019 out of more than 1,000 that were considered.
Bitcoin didn’t even make it to the top 20. It is this utility and technological potential that sets Cardano apart from its more famous rival. In addition to the online ledger that tracks transactions, Cardano has a second layer of computation that enables everything from smart contracts and decentralized applications, to buying land and voting.
“Bitcoin is a competitor? We don’t think so. Bitcoin is something else,” the 2019 post stated. “Bitcoin maintains the narrative of being digital gold.”
This idea that Bitcoin is better suited to be a digital store of value has been embraced by institutional investors over the past year, who have cited its finite offering (only 21 million coins will exist) and its already established reputation for delivering a solid return on investment.
Even Tesla has become attached to Bitcoin in this regard, choosing not to sell its $1.5 billion holdings. “When fiat currency has negative real interest, only a fool wouldn’t look elsewhere,” he explained in a tweet justifying Tesla’s investment. “Having some Bitcoin, which is simply a less foolish form of liquidity than cash, is adventurous enough for an S&P500 company.”
Musk has already shown his preference for other cryptocurrencies as an alternative to fiat currencies by accepting payments from Dogecoin at SpaceX, another of his companies. The question now will be whether the potential promised by the lesser-known Cardano can be popularized and materialized on a similar scale.
