Blockchain Consensus Mechanism and Climate Change

Abstract

This chapter examines the intersection of blockchain technology and its environmental impact, focusing on the energy-intensive validation protocols underlying blockchain systems. It provides a brief overview of blockchain technology and non-fungible tokens (NFTs), highlighting their unique characteristics and growing popularity. The transition from proof of work (PoW) to proof of stake (PoS) is analyzed in terms of their differing environmental footprints. The chapter explores climate change legislation from the United Nations Framework Convention on Climate Change (UNFCCC) to the Paris Agreement and offers an overview of European climate policies. It then assesses emerging legislative trends in the European Union, the United States, and China concerning blockchain’s environmental impact. Finally, it evaluates the legitimacy of PoW and PoS mechanisms within the framework of international and European climate regulations, offering insights into aligning blockchain technology with global sustainability goals.