While cryptocurrencies depend on the use of energy to generate their value, environmentally friendly cryptocurrencies do exist. These green crypto options offer a low carbon footprint — and can even provide real benefits for the environment. Finding the most energy-efficient cryptocurrency can help you to make environmentally responsible decisions about your investment strategies.
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15 Most Eco-friendly Cryptocurrencies You Should Know
The following comprise the 15 Most Eco-friendly Cryptocurrencies in the financial marketplace for your crypto portfolio.
1. SolarCoin (SLR)
SolarCoin is global, decentralized, and independent of any government. You can spend and trade SolarCoin just like other cryptocurrencies, but the key difference is that the platform aims to incentivize real-world environmental activity: verifiably produced solar energy.
SolarCoin has a novel approach to cryptocurrency, creating 1 Solarcoin for every Megawatt hour generated from solar technology.
2. BitGreen (BITG)
BitGreen is a community-driven initiative and energy-efficient alternative to Proof of Work consensus cryptocurrencies. It was founded as a response to the environmental impact of Bitcoin.
BitGreen is intended to incentivize eco-friendly actions, with users able to earn BITG by, for instance, carpooling on a ride-hailing app, buying sustainable coffee, and volunteering. Investors can also earn BITG by ‘staking’, using a desktop wallet, or building a master node.
3. Cardano (ADA)
Cardano functions mainly as a digital currency but can also be used for digital contracts, DApps, and other purposes. Compared to Bitcoin’s 7 transactions a second, Cardano can achieve 1000 per second.
Cardano is inherently more energy-efficient than Bitcoin as it uses a ‘Proof of Stake’ consensus mechanism where those participating in the currency buy tokens to join the network. This helps save a staggering amount of energy, with the founder of Cardano claiming that the cryptocurrency network consumes only 6 GWh of power.
4. Stellar (XLM)
The Stellar network is intended to be the bridging gap between traditional financial institutions and digital currencies. Stellar doesn’t charge institutions or individuals for using the network and is increasingly seen as a serious alternative to PayPal as it enables faster, easier, and more cost-effective cross-asset and cross-border transactions.
Through the Stellar network, investors can exchange US Dollars, Bitcoin, Pesos, Yen, and pretty much any currency traditional or crypto. The network’s token, Lumens, is used to facilitate these trades on the blockchain-based distributed ledger at a fraction of a cent and with great efficiency – which also translates to a lower carbon footprint. The network also allows individuals and institutions to create tokens for use on the network, which has inspired some to use the network for sustainability initiatives such as investing in renewable energy.
5. Nano (NANO)
Nano is free, fast, and uses considerably less energy than Bitcoin and many other cryptocurrencies. It is also scalable and lightweight as it doesn’t rely on mining.
Nano uses block-lattice technology, which is energy efficient. It is still reliant on a Proof of Work mechanism, but the block-lattice goes beyond blockchain to create an account chain for each user on the network. The Nano platform uses a system called Open Representative Voting (ORV), where account holders vote for their chosen representative, who then work to securely confirm blocks of transactions.
6. IOTA (MIOTA)
In terms of energy sustainability, because IOTA uses Fast Probabilistic Consensus for consensus and only relies on Proof of Work in part, the overall energy consumption of the network is very small. The best figures available for IOTA’s energy consumption come from a Ph.D. student called Amir Abbaszadeh Sori. Writing before the algorithm update, Abbaszadeh Sori calculated the average ECPT (energy consumption per transaction) for IOTA and found that each transaction used just 0.11 Watt-hours.
7. EOSIO (EOS)
EOSIO is a public blockchain beloved by developers because it is simple to set up and write applications in several programming languages, which is highly scalable, and costs nothing.
EOSIO is another ‘Proof of Stake’ platform that uses pre-mined EOS tokens that can be traded on standard cryptocurrency exchanges such as Coinbase, Binance, and Kraken.
8. TRON (TRX)
TRON is a non-profit organization and public blockchain supporting almost every programming language. The peer-to-peer platform allows creators to share applications directly on the blockchain, making the whole process more energy efficient.
The TRON currency, Tronix, is pre-mined and can be traded on Binance and other exchanges.
9. Burstcoin (BURST)
Burstcoin was possibly the first blockchain to use Turing-complete smart contracts which allow for the creation of non-fungible tokens (NFTs) and use in on-chain games. It is also likely one of the most environmentally friendly, sustainable cryptocurrencies as it has been using ‘Proof of Capacity’ rather than ‘Proof of Work’ since 2014.
With Burstcoin, ‘miners’ are rewarded for using storage space for ‘mining’. Meaning that a computer with a 1 terabyte hard drive barely uses more energy to mine Burst than an idling computer. This makes it far more efficient than ASIC mining or GPU mining on a ‘Proof of Work’ algorithm.
10. Holochain/HoloTokens (HOT)
Holochain is an open-source framework for peer-to-peer applications and its token HoloTokens (HOT) requires no mining. You don’t need any specialized processors, nor is there excessive energy use involved in generating this cryptocurrency. Anyone who hosts hApps on their computer or device can receive HOT in return.
In theory, transaction speed is limitless on Holochain, and energy expenditure is very low. In practice, there’s been no clear data on how much energy Holochain consumes, though it is bound to be many orders of magnitude lower than Bitcoin, Ethereum, and almost every other cryptocurrency.
Holochain is immediate and efficient, does not rely on proof-of-work or proof-of-stake, but still enables scalable crypto-accounting.
The DEVVIO network uses one-millionth of the energy usage of Bitcoin and generates far less in terms of greenhouse gases. It was designed specifically to reduce energy expenditure and be a ‘greener’ cryptocurrency.
The DEVVIO system can be used to authenticate green certifications, enable markets for carbon credits, and facilitating financing for sustainability projects. And it does this without creating inefficiencies and massive energy requirements as projects scale ever upward. This isn’t a proof-of-work blockchain like Bitcoin. Instead, individual nodes talk to each other, creating an energy-efficient system. It is also time-efficient in that a web developer can quickly hook into DEVVIO’s blockchain.
12. Hedera Hashgraph (HBAR)
This cryptocurrency (HBAR) is a proof-of-stake token that uses far less energy than proof-of-work tokens like Bitcoin.
HBAR is a decentralized public network used for in-app payments, micropayments, and transaction fees, as well as for network protection. Developers can use Hedera to build secure applications with near real-time consensus. This is because instead of being a block ‘chain’, Hedera is more of a graph. It’s based on a technology called a Directed Acyclic Graph (DAG) which means that the speed of transaction verifications increases as more transactions are added to the network.
Power Transition estimates that the Hedera Hashgraph platform is 250,000 times more energy-efficient than Bitcoin, using just 0.001-kilowatt hours per transaction, compared to 250 kWh for Bitcoin, 55 kWh for Ethereum, and 0.003 for Visa.
13. Chia (XCH)
The Chia Network is a blockchain and smart transaction platform that allows users to take advantage of available hard drive space to run the decentralized network. Instead of proof-of-work, the Chia Network relies on proof-of-space-time. So, storing a certain amount of data over a certain amount of time can earn you XCH, Chia’s token.
Chia farming was designed to be accessible, with no specialized equipment needed, nor massive amounts of power. The network’s blockchain transaction platform is called Mainnet and can be downloaded at chia.net. After downloading the software, you can choose to dedicate a portion of your uncommitted hard drive space to the network, without significantly affecting your computer’s performance or requiring vastly more energy.
14. Algorand (ALGO)
Algorand is a proof-of-stake blockchain that gets its value because it supports smart contracts. The influence of each user on the network is proportional to their stake in the system, and Algorand’s blockchain is scalable and secure, as well as free from forks and other potential governance issues.
The speed of transactions on the Algorand platform and its low transaction fees, in addition to being a proof-of-stake blockchain protocol, all mean that the network is more accessible, scalable, and uses far less energy than Bitcoin.
15. MetaHash (MHC)
MetaHash offers a fast, efficient decentralized network with zero fees and the ability to mine/forge MHC using fairly low-key hardware. MHC is just one of four parts of the MetaHash project, the others being TraceChain, MetaApps, and MetaGate. TraceChain is an algorithm for routing traffic over the network. MetaApps allows users to write stand-alone decentralized applications using C++, PHP, and Solidity, among other programming languages. MetaGate is an open-source user interface for third-party developers.