Blockchain technology has both positive and negative impacts on the environment due to high energy consumption and carbon emissions. However, a solution is proposed to reduce this impact by switching from proof-of-work to proof-of-stake, which significantly slashes energy consumption.
Environmental Impact
When technologies like cryptocurrency, NFTs, and ICOs are successful, they can have a negative impact on the environment due to high energy consumption and carbon emissions.
Future Applications
Blockchain technology has its limitations but could be used for decentralization and democratization of venture capital investment, art sales, and global finance. It needs thousands of small useful applications to mature.
Evolution Beyond Currency
The first projects to repurpose the blockchain were Namecoin and Litecoin. Namecoin provided a system for registering .bit domain names, while Litecoin aimed to offer faster transactions. The Ethereum project was launched in 2013, allowing developers to create their own blockchain-based software without starting from scratch. This led to the creation of smart contracts, which can enforce agreements without human intervention.
Challenges and Limitations
However, the platform also faced challenges, including a hacker making off with $50 million worth of custom currency due to a coding error. The article also touches on the ICO gold rush, where creators of new digital currencies raised funds through initial coin offerings, but many failed or were scams.
Industrial Applications
The use of blockchain in various industries is explored, such as tracking the provenance of luxury goods and securing voting systems. Additionally, the rise of NFTs (nonfungible tokens) and their potential to confer ownership of digital items are mentioned.
Environmental Impact
A solution to reduce the negative impact on the environment is switching from proof-of-work to proof-of-stake, which slashes energy consumption by 99.95 percent.
- wired.com | What Is Blockchain? The Complete WIRED Guide
