With more than 9,000 cryptocurrencies and counting as of March 2021, alternative coins (altcoins) represented 40% of the overall cryptocurrency market, according to CoinMarketCap. Among these are the so-called “green cryptocurrencies,” which aim to be 100% sustainable and energy-efficient during transactions.
Some altcoins function through protocols different from what Bitcoin currently uses. Bitcoin presently uses a Proof-of-Work (PoW) system to validate transactions. This mining technique, which aids bitcoin blockchain technology in verifying each transaction, is powered by a vast electrical network that consumes a lot of energy. On its vast network, the PoW system employs every single miner for every transaction.
This consensus mechanism also raised concerns from many environmentalists. It even became one of the driving factors for second to third-generation cryptocurrency developers to create the current altcoins we have in the market today. Below are five green cryptocurrencies that are performing well this year:
1. Cardano (ADA)
Cardano, which Ethereum co-founder Charles Hoskinson created, has soared in value in 2021, increasing more than tenfold since the start of the year. It is mainly used as a digital currency and digital contracts, decentralized applications, and other uses. Cardano can process 1000 transactions per second, compared to Bitcoin’s seven transactions per second.
It uses a consensus method known as Proof-of-Stake (PoS), in which participants in the currency purchase tokens to join the network. According to Cardano’s creator, this helps conserve an incredible amount of energy, who claims that the cryptocurrency network uses just 6 GWh.
Cardano is currently the world’s fifth-largest cryptocurrency by market capitalization, according to CoinMarketCap. You can also buy and trade this cryptocurrency here on the Bitcoin Revolution platform!
2. IOTA (MIOTA)
IOTA is a cryptocurrency designed to enable data transfer between any data recording unit connected to the Internet of Things. IOTA is unique because it does not operate a blockchain and instead uses a network of links to enable a different system. Tangle is the new system’s name based on a kind of cryptographic verification called Directed Acyclic Graph (DAG).
There are dedicated miners on the Bitcoin network. In IOTA’s Tangle, however, every participant contributes to the transaction validation process, allowing consensus to be established without the use of dedicated miners.
3. Ripple (XRP)
Ripple has existed since 2012 as a private platform that functions as a voting mechanism and relies on validators all around the world. Here’s one thing to remember: XRP is not a currency. Instead, it is a pre-mined token used to bridge asset transfers, with the network able to handle over 1500 transactions per second.
Ripple Protocol Consensus Algorithm (RPCA) is the protocol used by Ripple. With the use of this, at least 80% of the network’s global validators should approve a transaction before being published to the XRP ledger. As a result, customers may shift money across currencies with relative ease, cheap cost, and high speed (about 3-5 seconds each transaction.)
4. Stellar (XLM)
Stellar is an open-source blockchain payment system launched in July 2014 by Jed McCaleb, who is also a co-founder of Ripple. It was created to link traditional financial institutions and digital currencies, allowing for low-cost transactions in emerging areas throughout the world. Because it uses blockchain to maintain the network in sync, Stellar is significantly quicker, cheaper, and more energy-efficient.
The Stellar network’s consensus protocol is its most distinctive characteristic, Stellar Consensus Protocol (SCP). It is open-source and depends on trustworthy nodes to authenticate transactions rather than executing either Proof-of-Work or Proof-of-Stake algorithms over the whole network. As a result, the authentication cycle is much shorter and quicker, lowering expenses and reducing energy consumption.
5. Polkadot (DOT)
Polkadot is a blockchain network protocol. As a result, it’s a true multi-chain application environment, including capabilities like cross-chain registries and cross-chain computation.
It is built on a Nominated Proof-of-Stake (NPoS) system, which relies on network coin holding rather than energy-intensive mining.
Everything that’s listed above would be the best cryptocurrency for you. It depends on you! So, before you decide which cryptocurrency to invest in, conduct extensive research. Trading can be risky, but it can also be much fun and easier once you check out this beginner-friendly platform prepared by the team of Bitcoin Revolution.