how does blockchain impact climate change?

an eco-friendly solution for the third decade

Appeared in: ATTIC magazine - 2021

Note: This article was written before Etherium switched its model from proof of work to proof of stake, which is claimed to reduce energy consumption by 99.98%

Bob Blower, CEO Designate of Clarency has given a revealing glimpse under the hood of biz.Clarency, the compliance and payments platform was released in January.

“We identified from the outset that the immutability of a blockchain solution was a fundamental factor in creating an unquestionable audit trail. But we found ourselves repeatedly having to find workarounds to get past blockchain’s limitations.”

Blockchain, developed originally to provide solid dependability for crypto currencies, has become the lodestone for many cloud platforms where ultimate security is of paramount importance. Yet surprisingly few practical solutions have reached the market.

“Software development has its trends,” says Blower, “And blockchain has become something of a must-have designer badge, sometimes with few real benefits. The trouble is, it can be cumbersome to use, and its storage and power requirements are distinctly non-ecological. We were looking for a way to get the immutability and security of blockchain, but avoid the burden of vast networking, agent rewards and voting and – let’s be honest here – the fact that vulnerabilities have emerged to prove that it’s less secure than we’d all hoped.”

A worldwide search for an innovative development of conventional blockchain led the biz.Clarency team to InterlockLedger in Sao Paulo, Brazil.

“These guys were a breath of fresh air. Their ledger system has all the immutability of a conventional blockchain, but takes the model vastly further. It uses a patented trust system of interlocked signatures and checksums. It’s impressive, but their attitude impressed us even more. We showed them our platform and they dived in like heroes. The development arc from there on has been a real partnership.”

Ricardo Orsi, InterlockLedger’s CEO, has a similar view. “The biz.Clarency platform was exactly the use case that we wanted to allow us to develop our solution still further. What we saw was an application that could reveal the core benefits of our ledger, rather than using it as a fashionable add-on. Bob’s team are eager to share their aims, and we’ve each benefitted from the other’s insights. Among other things, that’s enabled compliance “movies” – instead of a static document register, we’re capturing every transaction, every decision, every invoice and stock movement into a chronological sequence that’s a regulator’s dream.”

blockchain and the environment

Blockchain technology is rarely questioned in terms of its environmental impact. But InterlockLedger revealed that the traditional distributed model gives it an appetite for energy that can't be ignored.

"Most blockchain ledgers use networks of thousands or even millions of computers, each working semi-competitively to provide a single source of truth," Ricardo Orsi explains. "With each new parcel of information, all of those machines negotiate to create copies of the data in the node with which they're associated. It's what makes blockchain so hard to hack, but it's also incredibly power-hungry. If each machine is consuming around 200KWh of electricity a year, a cluster of just 1,000 participants eats enough electricity to power your house for 65 years."

The InterlockLedger uses a different form of ensuring immutability. Its blockchain model needs as few as two computers to surpass the security of the wide-network approach. Not only is this more environmentally responsible, it vastly reduces the cost of running the blockchain.

"Every participant who allows blockchain to access their computer must be recompensed," says Orsi. "Traditionally, this is accomplished by rewarding the donor with a small amount of cryptocurrency. Multiply that by the millions of connectors and it becomes a serious running expense. This is an area where being eco-conscious can really save you money."

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