Environmental Aspect of Cryptocurrencies: Ethereum vs Monero

The climate and energy debate gets more heated every year. So do the criticisms of energy-intensive cryptocurrencies. The Bitcoin network uses more energy than some countries like Argentina (with a population of 45 million). A single BTC transaction emits 300kg of carbon dioxide.  

So, for those with environmental concerns, do any other cryptocurrencies do any better? Here we’ll look at the environmental credentials of two of the most used cryptocurrencies: Ethereum and Monero. We’ll see if they are more eco-friendly and whether it’s beneficial to swap XMR to ETH

Is ETH Eco-Friendly?

The focus of the environmental criticism targeting cryptocurrency is the Proof-of-Work consensus algorithm. It implies crypto miners competing with each other to solve difficult computational problems. The ones that consume the most energy get to create blocks on the blockchain and reap cryptocurrency rewards. 

Right now, the Ethereum network uses the energy-intensive Proof-of-Work, so it is not very eco-friendly. A single ETH transaction can power an average US household for around six days. From an environmental viewpoint, that is devastating. 

Will Ethereum 2.0 Change the Situation?

There is some eco-friendly light on the horizon for ETH. Ethereum is currently transitioning to the Proof-of-Stake consensus algorithm. This will remove the energy-intensive mining, and replace it with a more efficient staking model. If this transition to Ethereum 2.0 is successful, ETH will become much safer for the environment. 

Is XMR Eco-Friendly?

Monero also uses the Proof-of-Work consensus algorithm. It is also in the same ballpark as BTC and ETH in terms of environmental credentials. However, XMR is a much smaller scale blockchain than ETH, so each transaction currently takes much less energy to process. 

The difference with XMR is that it’s a privacy-focused token. Proof-of-Stake is not ideal for private transactions. Miners must prove that they own a certain number of tokens, which reveals network activity. As XMR will always be privacy-focused, it’s much less likely to move away from its private Proof-of-Work algorithm. So, the long-term environmental outlook for XMR is worse than for ETH. 

Are There Eco-Friendly Cryptocurrencies at All?

Third-generation blockchain companies claim to have solved the energy and environmental problems. These included networks like Cardano, Chia, IOTA, Stellar, Nano, and Ripple. There are even some tokens that are designed to be completely carbon neutral, such as Solarcoin and Algorand. 

These projects skip the energy-intensive computation or use renewable sources of energy. For example, Solarcoin ensures all mining is done by solar panels. IOTA uses a user-secured system called a Directed Acyclic Graph (DAG) that has very low energy intensity.

Are Green Cryptos the Future?

Many think that with the carbon-neutral commitments of many countries, Proof-of-Work is not long for this world. That’s why Ethereum is resolutely committed to switching to a Proof-of-Stake model in Ethereum 2.0. 

However, some experts think that Proof-of-Stake is doomed to fail. They say that Proof-of-Stake is really a Proof-of-Ownership model that requires a lot of pre-mining to secure the network. It provides control and rewards to those that are already wealthy owners of tokens, perpetuating inequality. 

There are also other centralization problems linked to Proof-of-Stake. The rewards for theft on Proof-of-Stake networks are high, as the stolen tokens can be accumulated over time and used for staking forever. There’s also governance risk. Staking rewards lead to even more cryptocurrency to stake, cycling into a centralized plutocracy over time. It remains to be seen if this will be a major problem in the long run.


Right now, neither ETH nor XMR are eco-friendly by any measure. However, ETH may soon move over to a Proof-of-Stake system that will be much more eco-friendly over time. So far, eco-friendly cryptocurrencies are doing well, hence why the Ethereum community is so keen to adopt the protocol. So, for environmental reasons, trading XMR for ETH may be a good decision in the near future. To preserve the privacy features of Monero, always use an anonymous platform like https://godex.io/ to conduct your XMR transactions.