Top 5 Sustainable Cryptocurrencies for Eco-Investing Opportunities

The need for sustainable cryptocurrencies started with Bitcoin’s mining problem. Due to the blockchain’s proof-of-work consensus mechanism, the process is highly electricity-intensive, but it’s also prone to electronic waste, as the computing hardware has no alternative use other than mining bitcoins.

Therefore, sustainable cryptocurrencies are demanded by those who prioritize sustainability but still want to push for the future of finance. That’s why some blockchain projects are making considerable projects to lower their carbon footprint, whether through more effective mining technologies or through collaborating with like-minded companies.

An example of such a ledger is Cardano, which uses a peer-reviewed consensus mechanism, Ouroboros, in addition to proof-of-stake. This led to minimal energy requirements for the ledger and maintained the protocol’s integrity and performance for users to leverage on the native cryptocurrency. So, we must consider technological progress and wider DeFi adoption trends when making an ADA price prediction.

But there’s more to the green industry than Cardano, so let’s explore the rest of the sustainable cryptocurrencies.

Cardano

Cardano is a unique network based on peer-reviewed research and evidence-based features. The ledger uses Ouroboros, a provably secure proof-of-stake protocol, one of the most environmentally sustainable blockchain protocols. It rewards users based on network participation in either a stake pool or through the delegation of a stake in ADA.

Cardano processes transactions by dividing chains into epochs that continue to divide into time slots. This mechanism is known as a settlement delay, in which the ledger securely passes between participants to avoid adversarial attempts.

Cardano has many use cases that could impact society, such as the following:

Digital identity management: Cardano uses tamper-proof and easily identifiable credentials on the blockchain to reduce fraud and ensure privacy;
Payment methods: The blockchain’s token, ADA, enables fast, low-cost, and secure payments by reducing settlement times and transaction fees.
Supply chain management: The network supports real-time tracking and verification of goods to avoid counterfeit goods or poor quality control.

Solana

Solana is considered the biggest “Ethereum killer” as it employs similar features, but with lower costs and faster transaction times. Nodes operate independently, the TPS (transactions per second) block times are 400 milliseconds, and the proof-of-stake consensus mechanism manages a low net carbon impact. Solana was designed for real-world uses, such as the following:

Payments and cross-border transactions: The network supports Solana Pay, a decentralized payment system that allows merchants to receive crypto.
Decentralized autonomous organizations (DAOs): Solana offers protocols for building communities for tokenized governance.
Decentralized finance (DeFi) on Solana evolves through decentralized exchanges, platforms for lending and borrowing, as well as yield farming and staking;

According to the Solana Foundation, besides being a tool for productivity, Solana is also striving to achieve sustainability through carbon offsets. The ledger’s high-performance and energy-efficient design has made it possible for it to partner with dedicated companies, such as Watershed, to promote job creation and assess the impact of greenhouse gas emissions on the planet.

Algorand

Algorand is another noteworthy blockchain whose commitment to sustainability impacts the real world. The digital ledger enables solutions at scale through pure proof-of-stake, which ensures data integrity and consumes less energy than regular proof-of-stake. Algorand leverages the Verifiable Random Function (VRF) so that only one block is generated for a transaction confirmation.

What Algorand does to be sustainable includes:

Using less computational power for the network, which also translates into more efficiency and less energy consumption;
There is no energy for failed transactions or forking since all transactions are finalized and irreversible the moment they are added to the block.
High throughput with 100% uptime even when the transactional volume increases, all without sacrificing decentralization;

Algorand is home to numerous sustainable projects, such as:

ClimateTrade is a blockchain marketplace for trading carbon credits and fighting climate change.
URECA, a system for verifying carbon data on the chain;
AI Goanna, an NFT project that plants a tree for every NFT sold;

Chia

Although the Chia network is less popular, it contributes to sustainability efforts by providing authenticity and data integrity. It is used for tokenization processes, where companies can digitize and track assets with an immutable system of record. In addition, the network enables complete control over digital assets and offers tradable features.

Chia spreads awareness on climate change through its Chia Climate Products that contribute to a carbon market infrastructure:

The Chia Climate App offers self-custody digital carbon assets.
The Chia Registry App issues digital carbon credits for projects.
The Chia Tokenization App, through which users can convert carbon credits into digital assets;

Chia is advocating for sustainability through its Climate Action Data Trust (CADT), a decentralized metadata platform that takes a transparent approach to carbon accounting and uses blockchain technology.

Tezos

Last but not least, Tezos is a Web3 tool that provides institutional-grade security, governance, and an upgradeable infrastructure to the world. It is a powerfully scalable network whose commitment to sustainability includes the following aspects:

A flexible design that makes the blockchain adapt to challenging user and transaction requirements;
A scalable approach to decentralization that secures a low carbon footprint per transaction;
An energy-efficient consensus mechanism, PoS, through which Tezos prioritizes innovation without compromising sustainability;

What’s unique about Tezos compared to other blockchains is its Life Cycle Assessment (LCA) by PwC. This includes thorough reports on the blockchains’ energy consumption and carbon footprint in accordance with the ISO 14040 and 14044 standards. The audit can be found on the official Tezos website and contains important information about how much the blockchain consumes, giving an example of how blockchains can gain customers’ trust while employing a decentralized future.

What do you think about these sustainable blockchains?

A sustainable blockchain and cryptocurrency means less energy is used on computational power and hardware that cannot be recycled. Compared with Bitcoin, whose energy consumption went through the roof, projects like Cardano, Solana, and Chia work hard to build a future where green investments are possible. This means using less fossil fuels to drive these projects and finding more innovative ideas on how to reward users and maintain networks fast and easily.