1. Learn Center
  2. Crypto Next Level
  3. Did You Know About These Eco-Friendly Cryptocurrencies?

Did You Know About These Eco-Friendly Cryptocurrencies?

4 Minute Read

Environmentalists and regulators have often criticized cryptocurrencies for their energy use. However, not every crypto project uses energy-intensive processes to run their blockchains. Thanks to the new proof-of-stake (PoS) validation system, there are many green cryptocurrencies that have a minimal impact on the environment. There are also many proposals and innovations that could make Bitcoin mining more eco-friendly.

We could consider almost all the most digital currencies, besides Bitcoin, eco-friendly cryptocurrencies. They’re becoming more common across Web3. As blockchain developers explore eco-friendly options, they could reduce the environmental impact of cryptocurrency.

Is cryptocurrency green? 

Currently, cryptocurrency isn't considered a "green" industry due to Bitcoin's energy consumption. Bitcoin remains the largest crypto by market cap and accounts for most of the crypto industry's power usage and pollution. 

Unlike many recent crypto projects, Bitcoin relies on the PoW consensus mechanism, which involves computers to solve algorithmic problems every 10 minutes to validate transactions. Whoever solves this problem first gets to claim crypto rewards and transaction fees. 

While the PoW mechanism has proven successful on the Bitcoin blockchain, it consumes a lot of energy. The more hash power BTC miners use, the greater the odds they'll receive BTC block rewards, encouraging miners to constantly increase their energy output. 

Current estimates suggest Bitcoin consumes roughly 150 Terawatt hours (TWh) of electricity annually, which is equal to the energy consumption of many countries. An estimated 62.4% of greenhouse gasses from the Bitcoin blockchain come from non-renewable resources like fossil fuels. However, some people argue this is necessary to maintain economic freedom and comparing energy usage to countries with outsourced industrial sectors is misleading.

What makes a cryptocurrency environmentally friendly? 

If a digital currency doesn't need excessive hash power or non-renewable resources to run its network, it's likely an eco-friendly project. Typically, any crypto that doesn't use proof-of-work (PoW) in its design will have a carbon-neutral or carbon-negative status. 

Currently, PoS is the most widely used alternative to PoW. Cryptocurrencies that use PoS don't force large computers to solve algorithms to validate transactions. Instead, these cryptos require validators to "lock" a set amount of the native digital coin on the blockchain. Anyone "staking" their coins has the chance to validate transactions and earn crypto rewards.

Besides using a PoS consensus mechanism, crypto projects could invest part of their treasuries into carbon credits or donations to environmental causes. For example, the Polygon Network announced it bought $400,000 in BCT and MCO2 carbon credits in 2022. Other crypto projects like Stepn are building eco-conscious incentives into their white papers. Built on Solana, Stepn encourages people to walk and jog for crypto rewards.  

Examples of low-energy cryptocurrencies

Almost all major cryptocurrencies besides Bitcoin expend relatively little energy. Here are some examples:


For many years, Ethereum polluted almost as much as the Bitcoin blockchain. While Ethereum relied on GPU crypto mining rather than Bitcoin's ASIC rigs, it produced about 44 million metric tons of CO2 each year. However, in 2022, the Ethereum blockchain switched its consensus mechanism from PoW to PoS in an event called the Merge, post which Ethereum's energy consumption and pollution went down by 99.9%. 


Solana is an Ethereum competitor that went live in 2020. Like many eco-friendly cryptocurrencies, the Solana blockchain uses a PoS algorithm. However, Solana's founder Anatoly Yakovenko introduced a new proof-of-history (PoH) algorithm that allows Solana to process more transactions per second (TPS). With the addition of PoH, some have argued Solana is the most efficient cryptocurrency, with an estimated 65,000 TPS. Recent estimates from the Solana Foundation suggest it produces about 3,412 tons of CO2 annually.  


Like Solana, Avalanche is a smart contract blockchain often included in lists of Ethereum competitors. Brooklyn-based Ava Labs and Cornell University used PoS to minimize Avalanche's environmental impact. According to the Crypto Carbon Ratings Institute, Avalanche uses about 489,311 kilowatt hours (kWh) of electricity annually, which equals the annual energy use of 46 homes in the U.S.


First introduced during the 2017 crypto bull run, Cardano is one of the oldest Ethereum competitor blockchains that uses a PoS algorithm. Although Cardano is still developing, it introduced smart contract capabilities to developers in 2022. In terms of environmental effects, the Cardano blockchain uses about 0.00277429 TWh of energy each year, which is roughly 47,200 times less than Bitcoin. 


Created by MIT professor Silvio Micali, Algorand is a PoS blockchain similar to smart contract platforms like Ethereum and Solana. According to the Algorand Foundation, this blockchain emits just 0.0000004 kg of CO2 for every transaction and uses the energy of about seven homes in the U.S. to power its blockchain per year. 


Tezos is another smart contract blockchain similar to Ethereum. Launched in 2018, the Tezos blockchain uses PoS to offer fast transaction speeds with low carbon emissions. According to Tezos' latest reports, it only produces about 2.5 g of CO2 per transaction. Put another way, the Tezos team claimed it produced the same amount of CO2 per year as about seven people. 


Unlike many other PoS chains, Polygon isn't in competition with Ethereum. Instead, Polygon is a layer-2 blockchain that helps users interact with Ethereum without paying as much transaction fees. Polygon's PoS design also takes the environmental burden off Ethereum. 

In a Green Manifesto, the Polygon team said it aims to be carbon-negative to prove its commitment to environmentalism. In addition to improving the efficiency of its blockchain, Polygon’s developers said they would set aside $20 million for energy credits and research toward improving their eco-friendly status. 

How to make cryptocurrency more sustainable 

The blockchain community is working on some of the following ways to address environmental concerns without sacrificing security. Even older PoW projects like Bitcoin are developing new strategies to reduce their carbon footprint. 

  1. Changing consensus mechanisms: Cryptocurrencies that use the PoW algorithm produce the most pollution and consume the most energy. For this reason, eco-conscious developers are more interested in consensus mechanisms like PoS or proof-of-authority (PoA). The more blockchains favor non-PoW options, the less of a burden the crypto industry will be on the environment. 
  2. Increasing eco-awareness in crypto communities: A few nonprofit organizations now advocate green alternatives in the blockchain industry. For instance, the Crypto Carbon Ratings Institute and the Bitcoin Mining Council work to spread information and encourage blockchain developers, miners, and other industry players to implement eco-friendly crypto solutions. 
  3. Promoting transparency in energy reporting: Another way organizations like the CCRI can improve crypto sustainability is by publishing high-quality research and transparent energy reports. Many blockchains and publicly traded crypto mining companies already release information on their energy consumption and average pollution rates. This data can help environmentalists and developers pinpoint issues and create actionable solutions. 
  4. Incentivizing renewable energy: Bitcoin advocates argue that miners will naturally migrate to more renewable energy sources as they learn the benefits of reducing their energy costs. Incentive-based programs to use energy sources like wind or solar may also decrease the use of fossil fuels.    
  5. Upgrading mining equipment: Companies like Intel, Block, and Shell Global announced they’re investing in state-of-the-art equipment for Bitcoin miners. Hi-tech computer chips, mining rigs, and cooling units may help miners increase efficiency without producing as much e-waste. 

Wrapping up 

Nobody knows if and how Bitcoin will become a more sustainable cryptocurrency. Some developers want Bitcoin to transition to PoS as Ethereum did, but others suggest investing in eco-conscious hardware improvements. Although it's unknown what path PoW cryptos will take, many new projects are adopting eco-friendly practices. Hopefully, as more developers and researchers enter the crypto space, there will be more green alternatives for the Web3 industry. 

At Worldcoin, we support the eco-conscious movement in the cryptocurrency sector. We also believe that more people will understand the value of crypto if they have the opportunity to use digital coins. That's why we're dedicated to airdropping DAI stablecoins to as many crypto wallets as possible. Subscribe to our YouTube channel to learn more. 

Subscribe to the Worldcoin newsletter