Thread by @iamDCinvestor

1/ we have new participants entering #Ethereum, first from #DeFi, but increasingly from #NFTs

many highlight concerns on energy consumption from Proof of Work blockchains like #Ethereum & #Bitcoin

let's talk about it, and how we'll move past it in #Ethereum Proof of Stake 🌳👇

2/ first, it takes a tremendous amount of energy to secure a Proof of Work (PoW) blockchain

PoW blockchains are secured by computers (mostly graphics cards and specialized hardware known as "ASICS") from "miners," solving a work-intensive math problem for every block produced

3/ the total "miner" contribution of this energy/computational power is known as "hashrate"

the "winning" miner who solves each new math problem first gets to produce the next block, and receives a block reward (in ETH, BTC, etc.) and any fees paid by users within that block

4/ to be most secure, you want as much hashrate as possible from as many sources as possible

in PoW, the hardware & electricity become something miners "put at stake" in PoW

this ensures honest behavior and is critical for the operation of a decentralized PoW network

5/ if they are found to have been dishonest in that block production, the network will revert their block and the miner will lose their block reward- in effect wasting their electricity

this creates an important financial incentive for honest behavior

6/ we can debate if this energy for PoW mining is "wasted" (as it is used for a productive purpose)

but we may agree that it is sub-optimal, and perhaps there is a better way

enter Proof of Stake- the upgrade which will make #Ethereum green 🌳

7/ in Ethereum 2.0 (eth2), the Proof of Stake (PoS) upgrade for #Ethereum,

rather than staking electricity to produce a block, block producers instead stake their $ETH

this shifts the security model from energy expenditure to collateral-based economic security

8/ yes, computers will still secure the network, BUT there will be no more complex math problems to solve, and no electricity to be staked

thousands of computers, using the power of a consumer laptop, can get the job done- versus energy-intensive industrial mining rigs

9/ the economic incentive for honest block production is the staked $ETH each block producer must lock

each validating node must put up 32 $ETH as "stake"

if they misbehave, those holdings can be "slashed"

this may prove to be even more effective at securing Ethereum than PoW

10/ so while #Ethereum PoW energy consumption remains high, the entire community is laser focused on transitioning to eth2 / full Proof of Stake

when will this happen? well, the first part of eth2 is already live, with 3.3 million $ETH committed / "bonded" to staking nodes 😲

11/ we expect that the merge/transition to Proof of Stake will happen within the next 1 to 2 years

so no, while current PoW energy consumption is not ideal, we will fix it

and our community & brightest minds won't rest until #Ethereum is a green blockchain 🌳🌍

12/ if you want to learn more about #Ethereum's transition to Proof of Stake, these articles may be useful:

coindesk.com/proof-of-stake

spectrum.ieee.org/computing/netw…

👆 tagging a few people here who may find this thread informative on how #Ethereum is working to eliminate energy consumption from mining by transitioning to Proof of Stake:

@saradietschy @dmitricherniak @ArtOnBlockchain @mattdesl @memotv @RAC

please share w/ others