Consensus Mechanisms

When discussing blockchain technology frequent generalizations are heard about its, supposedly inherent, enormous energy consumption. This perception inevitably raises concerns about adoption. However, blockchain technology is far from homogenous, meaning blanket statements about energy consumption should be reviewed with care. At the core of every cryptocurrency is the choice of consensus mechanism, and it is that which will define how much energy is required to run the network. Blockchain technology first entered public awareness in 2008 with Bitcoin and it remains the 800-pound gorilla in the room consuming more energy per transaction than any other blockchain. Since the introduction of Bitcoin there have been a number of different consensus mechanisms developed that are far less energy-intensive, numerous literature exists on the pros and cons of each but it pays to have an overview to clear up any misconceptions about future blockchain energy consumption.