Blockchain and Carbon Footprints
Apart from its most well-known application in cryptocurrencies, this ground-breaking technology is ushering in a new collaborative approach to processing transactions of all kinds in an increasingly connected world.
Blockchain technology has the potential to reduce the number of elements involved in traditional systems, whether in banking, logistics, the Internet of Things (IoT), healthcare, or even government operations.
Climate change is the most damaging effect of carbon emissions on the environment. It is the universal pressing challenge of the twenty-first century, with negative consequences felt in a variety of areas, as detailed below. Transportation, electricity generation, the use of fossil fuels for energy, commercial and residential waste management, and food production all contribute to greenhouse gas emissions. These gases cause the “greenhouse effect” by emitting thermal infrared radiation, which traps heat in the atmosphere and contributes to global warming.
Negative Impacts of Carbon Footprints:
Carbon emissions cause the following damage to the earth and the environment in which we live.
- Climate Change.
- Air Pollution.
- Toxic Acid Rain.
- Coastal And Ocean Acidification.
- Melting Of Glaciers And Polar Ice.
The PoW Consensus algorithm and Bitcoins
You may argue that bitcoin is the most harmful when it comes to carbon footprints as it uses the PoW consensus algorithm. The main drawback is that it requires extremely powerful mining and computational equipment to solve the hash functions!
Traditional Financial Institutions
It is also worth noting that the traditional international financial system consumes far more energy than the Bitcoin network. All of the disparate components that comprise the global banking network – banking data centers, card network data centers, ATMs, and bank branches – consume a significant amount of energy.
Power of Smart Contracts
The World Economic Forum has reported that “blockchain can play an important role in helping organizations across the world achieve net-zero carbon emissions and remains vital to the goal of reducing the average global carbon footprint with the help of smart contracts. Smart contracts running on blockchains can unlock new ways to fight climate change and to cope with its impact as they are decentralized and run automatically and don’t require much energy resources like others.
Through decentralization, cryptography, and the creation of new incentives, blockchain can enable greater trust and transparency. It is best known as the digital underpinning of cryptocurrencies, but it has evolved into a foundational technology with many applications. Even though we have not utilized the power of blockchain technology fully, the power it holds is humongous. Already blockchain is proving its efficiency in global supply chain management. In the near future it can change each and every sector, but only when blockchain software development company and its blockchain developers handle it in a socially responsible way by making wise use of smart contracts. Contact BSEtec for more details!