Pressure on BITCOIN after THE MERGE
Ethereum Merge brought back concerns on Bitcoin PoW model
After Ethereum's long-awaited Merge, which successfully reduced its contribution to climate change, Bitcoin remains the biggest cryptocurrency that's running under the PoW mechanism and consumes a significant amount of energy.
Green Peace USA and the Environmental Working Group (EWG), launched in March the campaign "Change the Code Not the Climate", which calls on bitcoin software developers to switch to a low-energy protocol.
Now that Ethereum has transitioned, the independent campaigning network started a petition encouraging Bitcoin to follow Ethereum’s PoS method.
“Ethereum has shown it’s possible to switch to an energy-efficient protocol with far less climate, air, and water pollution. Other cryptocurrency protocols have operated on efficient consensus mechanisms for years. Bitcoin has become the outlier, defiantly refusing to accept its climate responsibility.”, said the director of the “Change the Code, Not the Climate” campaign, Michael Brune.
The campaign pushes the most significant corporate partners and institutional investors, such as Fidelity Investments, PayPal, and Jack Dorsey’s Block, to encourage Bitcoin to reduce those environmental concerns.
Following the Merge, EWG plans to spend another $1 million on online ads meant to pressure the Bitcoin community to reduce the network's energy consumption.
Alex De Vries, an economist who runs the Digiconomist website, is not helping either saying:
"All eyes will be on Bitcoin. It remains the largest polluter in the crypto space. Even today Bitcoin is responsible for as much electricity consumption as Sweden."
Is Bitcoin next?
Vitalik Buterin, the founder of Ethereum revealed that “Merge will reduce worldwide electricity consumption by 0.2%”. The upgrade is truly an achievement for the Ethereum network, which was often blamed for leaving large carbon footprints.
Marion Laboure, a research analyst at Deutsche Bank, thinks that if Ethereum’s new staking system proves to be a greener alternative, “regulators might increasingly force the proof-of-work cryptocurrencies to cut down energy usage”.
MicroStrategy Inc. co-founder Michael Saylor, one of the biggest advocates of Bitcoin, said the software update of the Ethereum blockchain serves to boost the outlook for the world’s largest cryptocurrency.
Bitcoin now accounts for 95% of the overall market value of tokens using proof-of-work, but the Bitcoin maximalist defends mining against the energy critics:
“Bitcoin mining is the most efficient, cleanest industrial use of electricity, and is improving its energy efficiency at the fastest rate across any major industry. Our metrics show ~59.5% of energy for Bitcoin mining comes from sustainable sources and energy efficiency improved 46% YoY.”
Martin Škorjanc, CEO of crypto mining and exchange firm NiceHash, says about campaigners:
"They should understand how PoW and PoS really work, and realize that the energy use is necessary to provide an infrastructure that is secure, decentralized, and that generates real value."
It will be hard to convince the Bitcoin community that such a shift would be worth it since the two cryptocurrencies have different purposes:
"Bitcoin will always be like electronic digital gold. And Ethereum is like fiat money, it's just two completely different things", said the Tokenomics expert, Eloisa Marchesoni.
Crypto Educator, DeFi & Web 3 Content Writer