PayPal’s Blockchain Research Group Collaborates with Energy Web and DMG Blockchain Solutions to Support Sustainable Bitcoin Mining
PayPal’s Blockchain Research Group (BRG) has teamed up with Energy Web and DMG Blockchain Solutions to support “sustainable” Bitcoin mining, aiming to reduce the carbon footprint of the cryptocurrency. In a recent paper, BRG highlighted the environmental impact of Bitcoin mining, with annualized emissions exceeding 85 million metric tons of carbon dioxide.
The main culprit behind this environmental impact is Bitcoin’s Proof-of-Work (PoW) consensus mechanism, which requires miners to use powerful computational hardware and significant electricity, often sourced from carbon-based energy sources. To address this issue, BRG proposed incentivizing “green mining” through crypto-economic incentives.
The proposed solution involves routing on-chain transactions to miners using low-emissions energy sources, known as “green miners,” with BTC rewards locked in a multisig payout address. Only green miners would be eligible to receive these rewards, encouraging others to shift towards cleaner energy sources.
Energy Web, a non-profit organization, would help identify and onboard green miners to the solution through their “Green Proofs for Bitcoin” initiative, promoting transparency and supporting global decarbonization efforts. DMG Blockchain Solutions successfully tested the solution by broadcasting low-fee transactions to green miners, increasing their chances of confirming these transactions.
While the proposed solution shows promise, alternative methods such as using smart contracts or the Lightning Network could be explored to address the issues. Despite the controversy surrounding Bitcoin mining’s environmental impact, research has shown that the industry is increasingly using renewable energy sources, highlighting its potential role in the green revolution.
As Bitcoin continues to trade at high levels, reaching $65,972.43 on the one-day chart, the collaboration between PayPal’s BRG, Energy Web, and DMG Blockchain Solutions represents a step towards a more sustainable future for Bitcoin mining.
