Ethereum has been for a few days passed from proof of work to proof of stake regarding the operation and security of its network, which will greatly reduce energy consumption by 99%, much to the delight of environmental groups and people concerned about the environment in general.
But while environmentalists welcome the move from Ethereum to PoS, they wonder if Bitcoin, by far the largest cryptocurrency on the market, can also make the transition.
Environmentalists demand that Bitcoin follow Ethereum's lead
Others, instead of asking questions, simply ask that Bitcoin follow the same path as Ethereum, also initiating the transition from PoW to PoS.
This is the case of the Environmental Working Group (EWG), a US environmental defense group, which yesterday announced the launch of a $ 1 million campaign to push Bitcoin to move to proof of stake, in collaboration with Greenpeace. .
"Other cryptocurrency protocols have been operating for years with effective consensus mechanisms," said Michael Brune, EWG campaign director, adding that "Bitcoin has become an exception, defiantly refusing to accept its climate responsibility."
The Greenpeace and EWG campaign also plans to petition mainstream financial institutions such as Fidelity, BlackRock and Paypal to pressure the Bitcoin community to accept a protocol change to PoS.
It is worth noting that this news comes shortly after the White House released a report strongly criticizing PoW cryptocurrency mining and urging it to remedy its energy use or risk being banned.
Furthermore, the topic of energy consumption for cryptocurrency mining has gained importance in recent months due to the global energy crisis.
Can Bitcoin also switch from PoW to PoS?
However, some experts believe these requests reflect a profound misunderstanding of how Bitcoin works. In fact, purists believe that PoW is the real innovation in the creation of Bitcoin and that it is essential for its correct functioning and for the respect of its original philosophy.
Without going into the technical details, it should be noted that PoS networks carry the risk of centralizing power over the network, which is not possible with Bitcoin's highly distributed PoW system.
Furthermore, it is not the first time that Bitcoin has been asked to change its operation. A few years ago there was talk of increasing the block size of the Bitcoin blockchain, which would lead to the centralization of the network nodes.
However, this attempt to centralize the network ultimately failed, as the decentralized network remained strong and an upgrade known as SegWit allowed the necessary block size updates without centralizing the Bitcoin infrastructure.
Furthermore, the criticisms of Bitcoin and its energy consumption are partly unfounded. In fact, Bitcoin mining companies are increasingly using renewable energy to power their businesses. Furthermore, Bitcoin mining can help regulate power grids by consuming excess energy at times when consumption is low and production cannot be reduced.
Finally, there are also regulatory risks if you switch to PoS. In fact, regulators tend to regard cryptocurrencies based on a PoS system as securities, which makes them subject to financial regulations, with the drawbacks that this entails.