Energy-efficient Consensus Algorithms: Analysing energy-efficient consensus algorithms (e.g., Proof of Stake) to address the environmental impact of blockchain networks

Abstract

Energy consumption in blockchain networks, particularly in the context of consensus algorithms, has become a significant concern due to its environmental impact. This paper investigates energy-efficient consensus algorithms, primarily focusing on Proof of Stake (PoS), as a potential solution to mitigate this impact. The study begins with an overview of the environmental challenges posed by traditional consensus algorithms like Proof of Work (PoW). It then delves into the principles and mechanisms of PoS, highlighting its energy-saving characteristics. The paper further examines the implementation and performance of PoS through case studies and comparative analyses with other consensus mechanisms. Additionally, it discusses the implications of adopting PoS for blockchain networks in terms of scalability, security, and decentralisation. The findings suggest that PoS offers a promising approach to achieve energy efficiency in blockchain networks without compromising on security and decentralisation.