Ethereum is moving to PoS Method! A huge advantage against Bitcoin

Ethereum is moving to PoS Method! A huge advantage against Bitcoin

BUSINESS | May 26, 2021 | WOZINGA NEWS

Ethereum is moving to PoS Method! A huge advantage against Bitcoin

  • Ethereum intends to use the PoS model.
  • The change will help save 99.5 percent of the energy it currently consumes.

By Elah Mae Ariate Wozinga Journalist

Ethereum is moving to PoS Method

According to Tim McDonnell, Bitcoin mining consumes the same amount of electricity as Argentina. It releases the same amount of greenhouse gases as the London metro area. The reason for the large footprint is due to the way Bitcoins are mined. Several computers compete to unlock coins by solving increasingly difficult math problems.

Proof-of-work (PoW) is a computational methodology.  In this method, running more computers more effective is the only way you can gain an advantage over other miners. Cryptocurrency, according to Jack Dorsey, co-founder of Twitter and proponent of bitcoin, can promote clean energy consumption by becoming a cornerstone customer for large solar and wind farms.

The majority of bitcoin mining power comes from coal-fired power plants and hydropower dams in China. However, regardless of where it comes from, it is not good to use many energy services.

Ethereum is planning to shift to PoS Method

According to Carl Beekhuizen, an Ethereum Foundation researcher, the change will help save 99.5 percent of the energy it currently consumes. Ethereum already consumes less energy than the most popular cryptocurrency. According to Beekhuizen, the transition to the proof of stake system (PoS) from the proof of work system (PoW) will be completed soon.

Beekhuizen wrote that several engineering teams are working around the clock to ensure that ‘The Merge,’ or the moment Ethereum switches from PoW to PoS, occurs as soon as possible without jeopardizing safety. Other smaller cryptocurrencies already use the proof of stake method. It also grants access to new coins based on the number of coins a miner already owns. For example, if a miner owns 3% of all coins, he or she can only access 3% of new coins.

This system reduces the need for energy-intensive number crunching because a miner’s rate of coin access is determined by their “stake,” not their “work.” As a result, proof-of-stake mining software can now run on a single standard computer rather than a warehouse of servers. Also, there is no longer a strategic need to consume an increasing amount of energy.

Benefits of Proof of Stake Method

Proof of stake is a sort of distributed consensus technique used by blockchain networks. PoS Model requires users to stake their ETH to become a validator in the network.

Validators are like miners in proof-of-work. They are in charge of arranging transactions and constructing new blocks so that all nodes can agree on the network’s state.

Proof-of-stake adds several improvements to the proof-of-work system:

  • Improved energy efficiency – you do not need to use as much energy as mining blocks.
  • Lower entry barriers, lower hardware requirements – you do not need elite hardware to have a chance of creating new blocks.

  • Greater resistance to centralization – proof-of-stake should result in more nodes in the network

  •  Improved support for shard chains – a critical step toward scaling the Ethereum network

In Proof-of-stake, miners do not need computational power. They are replaced with validators and, they do not compete to create blocks or mine digital coins. But they are chosen randomly by an algorithm.

Ethereum moving to PoS Method is a huge advantage against Bitcoin. Do you agree?

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