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Proof-of-Activity (PoA) Might Be The Solution For Blockchain’s High Energy Consumption

Published May 27, 2021 | Updated May 27, 2021

proof of activity POA

Proof-of-Activity (PoA) Might Be The Solution For Blockchain’s High Energy Consumption

Over the last half of a decade, ever since Ethereum had emerged, the attention has been shifted from crypto itself to the potential and possibilities of blockchain technology. To this day, countless theoretical and practical use cases have been discovered, and there are undoubtedly many more that are still waiting to emerge.

However, for all of its potential, blockchain has a major flaw, which lies in its high energy consumption. This was a major topic over the last several years, and even more so over the past few weeks. As some may remember, Elon Musk, the CEO of Tesla and SpaceX, recently announced that Tesla will stop accepting Bitcoin payments for its electric cars. Only a few months earlier, the company announced that BTC payments will be allowed, and now, the company seems to have had a change of heart. 

Musk stated that the reason behind the decision is high energy consumption, that has been a major problem regarding Bitcoin mining for years now. Of course, this should not come as a surprise. After all, the very reason why Tesla is working on perfecting electric cars is to help reduce the carbon footprint. He also added that Tesla might be willing to start accepting BTC again should this issue be solved. Of course, Bitcoin is not the only crypto with this problem, even though not all coins are facing this issue.

Ethereum also uses the same Proof-of-Work (PoW) mechanism, which is why it made a considerable effort to switch to Ethereum 2.0, which will bring Proof-of-Stake as its new consensus. 

However, PoS might not be the only solution to this issue, as Proof-of-Activity (PoA) might be equally as effective.

What is Proof-of-Activity?

PoA is another consensus algorithm that could and should be considered as a standard as it involves a collective of the so-called ‘publishers,’ who can verify microblocks by reaching a consensus. As such, it is far less intensive when it comes to the use of communications resources, storage, and yes, energy.

With it, one could run a consensus algorithm for a blockchain even with their regular mobile device, which is something that is impossible with PoW, which requires high processing power and a lot of electricity.

PoA has been confirmed to work, as it has been used by the Enecuum blockchain for quite some time now. It is, essentially, a hybrid model that combines the best features of PoW and PoS. Like PoW, it features nodes that are scattered around the globe, and it allows users to confirm transactions utilizing pretty much any device that can be connected to the network. As such, it is both, attack-resistant, eco-friendly, and still a fully decentralized system.

It works because it taps into the largely under-utilized processing power of smartphones, which could still offer a validation process and decentralized storage. The network speed would increase with the number of connected devices. It will not damage the devices, as the use of PoW elements is minimal, and it mostly relies on PoS. The reason behind this is that the PoW approach could be harmful to autonomous devices, due to natural battery limitations. This was even confirmed in a research paper that was published last year.

Regardless of which projects we are talking about — be it Bitcoin, Ethereum, or Enecuum — the goal is the same, and that is to help blockchain and crypto go mainstream. However, this can only happen if they use the technology that is better and less harmful than the original solutions, which cryptos and blockchain have stood up against in the first place. 

Blockchain development is still in its early days, as people have been focusing on it only for half of the crypto industry’s total lifetime, which is, itself, quite short. The solution will undoubtedly emerge as development continues, and there is a large possibility that the technology for solving the issue already exists. It might be PoA, in which case, its adoption should be one of the highest priorities of the blockchain industry. In any case, even if there is just a possibility that PoA could solve this issue, it is certainly worth investigating it.

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The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
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Andrey Sergeenkov 18 Articles
Cryptocurrency investor and trader. As an independent journalist, he covers DeFi, crypto, blockchain, and crowdfunding.
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