Cardano’s green cryptocurrency ADA now has the third-largest market capitalization, behind Ethereum and Bitcoin, worth $90 billion. The sudden rise of this cryptocurrency could also mean that crypto enthusiasts have raised their awareness about the impact that crypto mining has on the environment.
As The Recursive previously reported, Cardano is one of the most popular green cryptocurrencies on the market. It uses the proof of stake blockchain verification system, which reduces computer usage and energy use. Therefore, instead of requiring heavy mining, the system chooses users with larger stakes to verify transactions and add blocks to the chain.
Up until now, cryptocurrency miners have mostly preferred to mine Ethereum, but at the moment most of them are also faced with a shortage of graphic cards that are used as mining equipment.
“The Bitcoin alternatives like Ethereum are the favorite choice of local miners. Equipment in this case represents computer graphic cards (GPU) joined to work together on cryptocurrency mining (solving cryptographic puzzles). One event that might slow down an industry a bit is a global chipset shortage. nVidia and other manufacturers announced that the shortage will last at least until early 2022”, Arvin Kamberi, Vice President of the Serbian Bitcoin Association, tells The Recursive.
According to a 2019 study in the scientific journal Joule, Bitcoin production is estimated to generate between 22 and 22.9 million metric tons of carbon dioxide emissions a year, which is somewhere between levels produced by countries such as Sri Lanka and Jordan.
In May, Tesla’s CEO Elon Musk also cited environmental concerns when he announced that his company won’t be accepting Bitcoin. “We intend to use it for transactions as soon as mining transitions to using more sustainable energy.” Musk said in a statement back then.
However, last month Musk retracted once again, saying that Tesla will “likely” resume accepting Bitcoin.
While almost three-quarters of the world’s Bitcoin supply has been produced in China, earlier this year Beijing also vowed to crack down on bitcoin mining. In turn, this had severe consequences on the cryptocurrency market.
“Reports from China are showing empty mining places, and workers packing their equipment. A lot of that equipment will end up in neighboring countries (like Kazakhstan), and a big part in the US which develops plans for harnessing green energy to mine bitcoin. Bitcoin is not mined on a GPU graphic card, but instead uses the specific machines (ASIC) that can do no other operations. Anyhow, all reports on bitcoin mining point to a considerable e-waste threat”, Kamberi tells The Recursive.
Cardano’s rise also comes amid announcements from the company on an upcoming September upgrade that is expected to introduce smart contracts to its blockchain.
According to cryptocurrency enthusiasts, this approach could also start a trend with new and upcoming cryptocurrencies as well.
“Cardano is one of the best crypto available when it comes to strategy. Soon, I think that most cryptocurrencies will shift to this approach.” Prague-based cryptocurrency enthusiast Michael Lambert tells The Recursive, adding that in this way, those cryptocurrencies might also become more appealing to future investors and users, too.
Together with the advantages that it offers over other cryptocurrencies, namely far less energy consumption and staking, this means Cardano could become an even more popular choice in the upcoming period, especially with those choosing sustainability.
