Limitations of Proof of Work (PoW) and Environmental Degradation
Various consensus algorithms exist to prevent data changes by malicious nodes on a blockchain network since it can cause critical errors in the system. Proof-of-Work (PoW) method is also a form of consensus algorithm, and bitcoin is the representative cryptographic money which applied to it. The proof-of-work (PoW) method secures blocks in the block chain with the goal of de-centralizing, so this algorithm works by solving encrypted puzzles through an unconditional computation, and the miner who first solves the puzzle will be rewarded accordingly.
Cryptographic notes using Proof-of-Work (PoW) algorithms often has less difficult encrypted puzzles at the beginning level, thus during the initial publication, mining is available only with good hardware, but this approach will eventually give more rewards to those who have large quantities of expensive equipment. In the end, it resulted in numerous ‘Mining Farms’ being constructed all over the world, and mass mining in areas where electricity is produced by fossil fuels caused huge environmental pollution problems. What’s more serious is organizing a Mining Pool by gathering a large number of Mining Farms, this created a centralization problem to an algorithm that aims to de-centralization. The combination of large Mining Pools allow 51% Attack and enables the entire control of a blockchain, and this will result in Byzantine general problem, which means if 51% of nodes enter the protocol with crafted information, they can either distort the facts or falsify the true data with crafted information and approve the transaction.
The reason why C3W decided to use existing validated platform rather than developing a mid & long-term, independent platform, is because of securing early priority and access to the Blockchain ecosystem in the energy welfare sector while our society is moving to a hyper-connected society. The reason for shifting toward stable Ethereum Platform-type Token Issuance is also because we couldn’t just ignore the environmental damage caused by mining with PoW algorithms specifically.