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The energy consumption of cryptocurrencies continues to pose a problem for many. But what if one of the most significant projects on the market reduced almost 100% of its consumption in a matter of months? Well, that's just what happened with Ethereum post-merge. Ethereum reduced CO2 emissions from 21.95M tons to 8.82 tons. The Merge, after all, was a significant change for a greener future.
According to a Forex Suggest's research report, Ethereum reduced its CO2 emissions by almost 100%. All this reduction has a reason for being: The Merge. With The Merge, Ethereum's blockchain went from proof-of-work to proof-of-stake consensus.
By changing the consensus to a staking-based one, Ethereum mining was left behind. And with mining gone, high energy consumption also became a thing of the past.
While energy cost comparisons are made on a year-to-year basis, the Merge went into effect last September 2022. Energy consumption per transaction went from 62.56 kWh to 0.03 kWh, meaning the network is more efficient than ever. It also represents the power and potential of proof-of-stake networks.
The report also found something shocking about the impact of the Merge. Pre-Merge, 109M trees would have to be cultivated to cope with Ethereum's CO2 emissions. Post-merge, only about 44,121 trees need to be planted.
The switch to proof-of-stake, however, did not have the desired effect at the price level. After the Merge, daily rewards dropped to 13,000 ETH per day - still inflationary but representing a 90% drop in Ethereum's annual issuance. This drop is equal to three Bitcoin halvings in one. Yet, the market barely reacted to it due to macroeconomic factors.
Despite this, Ethereum is still not the greenest coin on the market — that spot goes to Stellar (XLM). Stellar, one of the oldest coins in the market, consumes about 0.0003 kWh per transaction. In other words, a transaction in XLM consumes 100 times less than one in Ethereum.
However, this is not a competition to see who consumes more or less. The big takeaway is that Ethereum, the second-largest coin in the market, now hardly consumes any energy. While other currencies, such as Bitcoin, may be unable to make this shift, many others may move to proof-of-stake.
If people intend to use coins with low environmental impact, they can now add Ethereum to that list. A list of Stellar, Nano, Polkadot, XRP, and Ethereum gives users multiple options to choose from.
And that's not all: Ethereum devs work every day to find ways to make Ethereum more efficient than ever. Ethereum is now green and always will be.