As investors consider digital asset adoption, they are also concerned about the impact of energy consumption. Bitcoin’s consensus mechanism, Proof-of-Work, consumes a large amount of electricity, with the Bitcoin network using as much energy as some small nations. Proof-of-Stake, an alternate consensus mechanism that eliminates the need for high computational power, is considered a popular solution for addressing crypto energy concerns and offers yield opportunities, and its adoption may increase as the broader digital asset industry sees the effectiveness of yield as an incentive.
This report highlights conversations and developments related to energy usage concerns around digital assets, blockchains, and distributed ledger technologies, as well as initiatives by industry participants that are intended to address environmental concerns. As a popular solution, Proof-of-Stake and its role in providing yield opportunities is discussed. Our report is compiled from Digital Asset Research’s (DAR’s) data sources, public sources, media reports and press releases, and, while wide-ranging, covers only representative initiatives related to environmental concerns in the digital asset space.