Proof of Work mining (the protocol underpinning Bitcoin and many others) uses as much energy as the nation Denmark. It’s a costly and lengthy process, and with the user base growing traditional blockchains are struggling.
This is because every single transaction needs to be ‘mined’ by powerful computers solving complex mathematical problems. It’s a process that ensures the security of the network, preventing double spends and other malicious actions. Whilst effective, the energy inefficiency of this process is truly staggering. And that’s not all. With each transaction needing a lengthy confirmation process, the blockchain cannot scale easily as more and more users join the network. Bitcoin transactions are now unbearably slow and expensive, with long backlogs of transactions waiting their turn.
Ethereum too is suffering from the same issue. Although the network can currently handle around fifteen transactions per second, significantly more than Bitcoin, we need only look at the recent Cryptokitties mania to see the crippling effect of high network load. Backlogs of transactions quickly built up and transaction prices skyrocketed as users fought to get included in the next block. With the severe limitations proof of work seen, it seems impossible for real-world use cases to succeed. VISA and other non-blockchains handle thousands of transactions per second, and if the many projects emerging in the crypto space are to compete, something needs to change.
Read more at:
https://www.ccn.com/proof-stake-coming-will-game-changer/
