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December 14, 2023

Ethereum’s Energy Efficiency Triumphs: Outperforms Major Corporations

Ethereum's energy prowess shines brightly, showcasing a significant leap in sustainability

In a groundbreaking report from the University of Cambridge, Ethereum, the world's second-largest crypto protocol, emerges as an energy efficiency champion, consuming a staggering 28 times less energy than corporate giants like American Express. The comparison extends to legacy-based financial institutions, revealing Ethereum's environmental prowess in the ever-evolving landscape of blockchain technology.

According to the Cambridge Blockchain Network Sustainability Index, Ethereum's annual energy consumption of 7 Gigawatts per hour (GWh) is a mere fraction compared to American Express, operating on a whopping 202.73 GWh. Delving further, Ethereum stands out as a beacon of efficiency, using 50 times less energy than Deutsche Bank, a financial titan managing assets exceeding $820 billion.

The report unveils Ethereum's dominance not just in the financial sector but across diverse industries. Ethereum proves 25 times more energy-efficient per dollar managed than Deutsche Bank. It outshines Netflix, consuming 123 GWh annually, and is over 30 times less energy-intensive than the iconic Burj Khalifa, known for its towering architecture.

Beyond the financial realm, the report delves into Ethereum's impact on everyday life. It reveals that the energy needs of the decentralized finance ecosystem, thriving within Ethereum, can power 1,969 average households or run 676 air conditioners for a year. To put it in perspective, Ethereum's annual energy output would fuel a Tesla Cybertruck covering a staggering 17.1 million miles.

This exceptional energy efficiency follows Ethereum's transformative shift from the energy-intensive proof-of-work (PoW) consensus algorithm to the eco-friendly proof-of-stake (PoS) mechanism earlier this year. The transition eliminates the need for energy-consuming mining activities, opting for validators who lock up a minimum of 32 Ether coins to verify transactions.

As the heart of decentralized finance (DeFi), Ethereum's appeal continues to grow with over 2,000 decentralized applications (dApps) in its ecosystem. Recently, the decentralized Verifiable Random Function (dVRF) service by SupraOracles on the Ethereum mainnet signifies another leap forward. This innovative service allows blockchain protocols to access real-world information securely, strengthening Ethereum's position in the competitive crypto market.

Ethereum's exceptional energy efficiency not only marks a triumph for blockchain technology but also positions it as a sustainable alternative in a world increasingly conscious of environmental impact. With Ethereum's ongoing evolution and the introduction of groundbreaking services like dVRF, the crypto giant stands poised to shape the future of decentralized finance and emerge as a formidable contender in the broader financial landscape.

Josefina Dipaolo
Josefina Dipaolo
Content writer at TechNews180
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