What Are Green Cryptocurrencies

Last Updated on 1 month by Irfan Khan

Two words that matter here: Green and Cryptocurrencies. Green implies that such a thing should be eco-friendly or environmentally beneficial. On the other hand, cryptocurrencies are a form of digital assets based on a network distributed across many computers. They are designed by a process called mining. Unfortunately, mining a digital coin consumes large amounts of energy, which has raised several concerns about the harm it poses to the environment.

Why Green Cryptocurrencies?

Traditional cryptocurrencies like Bitcoin and Ethereum are not considered eco-friendly. This is because their mining process uses non-renewable energy sources and large amounts of electricity to power complex algorithms. For example, the typical model for crypto mining is called “Proof-of-Work (POW)”, which requires vast energy sources to solve the complex computations of creating a coin.

Green Cryptocurrencies are alternative, eco-friendly cryptocurrencies that are less harmful to the environment. The use of green cryptocurrencies minimizes environmentalists’ fear of how the mining of cryptocurrencies can affect the environment. Compared to traditional mining, a new model of creating crypto is called “Proof-of-Stake (POS)”. A POS method does not need special equipment to solve the computations, leading to lower energy use.

Also read : Are Cryptocurrencies secure? How to Invest Safely

Types of Green Cryptocurrencies

Unlike Bitcoin and Ethereum, digital assets are more energy efficient. This means that the energy requirements for creating a digital coin reduce its environmental impact. The following are some of the popular eco-friendly cryptocurrencies.

Cardano (ADA):

ADA uses a POS algorithm called Ouroboros to scale its sustainability. Instead of mining new coins, members are required to buy tokens to join the network. This means it uses less energy to achieve the same end as other traditional coins – transactions. Cardano uses 0.5479 kilowatts per hour, compared to Bitcoin’s 707 kilowatts.

Nano (XNO):

Although Nano uses a POW to create its cryptocurrencies, it is still considered eco-friendly crypto. This is because it uses an Open Representative Voting protocol to confirm transactions. This process reduces energy use and increases efficiency. In addition, Nano transfers are instant, and it is free to trade.


SolarCoin exists to encourage green energy production. It is a blockchain-based currency that rewards generators with SolarCoins for the creation of solar energy. The idea behind SolarCoins is that where more people receive incentives to create solar energy, it will increase the production and distribution of clean energy.

Chia (XCH):

Chia uses a process known as Proof-of-Space and time rather than the POW approach to producing cryptocurrencies. This involves the use of hard drives to “farm” Chia coins. Using hard drives to produce coins means that Chia’s blockchain does not require large amounts of computer electricity.

Also read : Why Do Some Cryptocurrencies Fail While Some Succeed?


IOTA uses a different kind of technology called “Tangle” that does not require mining. It enables the transfer of data and value without any transaction fees. Smaller devices maintain IOTA and, thus, has lesser energy requirements. It consumes 0.00011 kilowatts to power each transaction on the network.

Final thoughts

Cryptocurrencies are one of the most embraced concepts, and they are bound to keep gaining momentum. In addition, there is a growing need to adopt more environmentally sustainable practices. This is why green cryptocurrencies are important. Though they are still developing, they can make the crypto industry more eco-friendly.

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About Irfan Khan

Irfan Khan is an esteemed professional known for his strategic contributions to the banking industry, particularly in the realms of financial technology and innovation. Holding a Master’s degree in Finance, Irfan has built a distinguished career by leveraging his deep understanding of financial systems and technology to drive operational excellence and digital transformation in banking. With extensive experience in developing and implementing innovative banking solutions, he has played a pivotal role in enhancing customer experiences, streamlining operations, and introducing cutting-edge technologies to traditional banking environments.