Published on October 6th, 2018 | by Michael Barnard0
What Is Consensus? (Blockchain Report Excerpt)
October 6th, 2018 by Michael Barnard
Along with our regular daily clean tech news coverage, CleanTechnica also produces in-depth reports on various aspects of clean energy and clean transport. One of the emerging technologies we cover that isn’t directly a clean tech innovation is blockchain, which promises to be a catalyst for innovation in the green economy in the very near future. Blockchain is probably most widely known to the public as “having something to do with cryptocurrency and Bitcoin, right?,” which is partially correct, but the technology itself has a wide range of applications, some of which will be crucial in the fields of distributed renewable energy, grid management and energy storage, and smart contracts, among others.
The full report Blockchain – An Innovation Enabler for Clean Technology, which was published in July, is a deep dive into blockchain and its potential, and we will be posting more excerpts from the report over the coming weeks. (Read the 1st and 2nd installments.)
There are a bunch of hidden nuances to blockchain, of course. Most blockchains run on proof-of-work, which is to say that blockchain is protected by making it artificially hard to create a block, hence Bitcoin’s power use. An emerging approach is proof-of-stake, where honest participants own at least 51% of the assets. It’s a lot less computationally expensive.
Similarly, the entire blockchain concept is a solution to a computer science problem from the 1970s that was formalized in 1982 as the Byzantine Generals’ Problem. At heart, it’s a question of how a bunch of systems can collaborate with trust when malicious actors are trying to disrupt the system. Proof-of-work and proof-of-stake are different solutions on top of blockchain to that problem.
The proof-of-work piece is interesting because the nodes that figure out the next hash get paid, typically in the cryptocurrency in question. That’s how Bitcoin comes into being in the first place. A bunch of nodes called miners are all competing to find the hash for the next block and the one that wins gets to create it and gets paid for it. The rest just spent a bunch of money on computer power and electricity with nothing to show for it. Bitcoin is designed so that it gets harder and harder to discover the hash with each block and that combined with the current high value of Bitcoin means a lot of people are competing globally, hence the electricity consumption.
Stay tuned for more excerpts from Blockchain – An Innovation Enabler for Clean Technology, or view the summary and request the full report at https://products.cleantechnica.com/reports/