Author: Anton Ragin 2021-05-23 10:42:49
Published on: 2021-05-23T10:42:49+00:00
The Bitcoin network has a self-balancing system that reduces energy consumption as adoption decreases due to public concerns about its environmental impact. Additionally, in 2024 block rewards will decrease by 50%, further reducing incentive for miners. To make Bitcoin greener, users could prioritize green miners who would receive more transaction fees, creating an economic incentive for environmentally-friendly mining. A proposal was made on the bitcoin-dev mailing list to reduce the block reward gradually by adding fewer coins to the UTXO set per block, which would reduce the maximum energy price at which mining is profitable. This proposal is a soft fork and has some potential weaknesses including increased centralization towards Chinese miners, the possibility of a network split if consensus is not built before implementation, and the cost of reversing recent Bitcoin transactions. However, given the current political climate and public discussion around Bitcoin's energy use, it may be socially feasible to ask individual users and major exchanges to install a version of Bitcoin with reduced block rewards. An alternative proposal is to treat transactions attempting to spend increased block rewards as no-ops.
Updated on: 2023-06-14T22:08:50.658427+00:00