PayPal, in collaboration with Energy Web and DMG Blockchain Solutions, has put forth a proposal to incentivize sustainable Bitcoin mining by introducing cryptoeconomic incentives.
Under the proposal, “green miners” using sustainable energy sources would receive special “green keys” associated with their public keys. Bitcoin transactions would be directed preferentially to these green miners, offering lower fees and an additional locked BTC reward in a multisig payout address accessible only to them. This system incentivizes profit-driven miners to adopt low-carbon energy sources to access additional BTC rewards.
The proposal leverages Energy Web’s “Green Proofs for Bitcoin” platform to certify miners based on their use of clean energy and their impact on the grid. Green miners can register and share their green keys on the platform to participate in the incentive program.
PayPal BRG has successfully tested the solution with Bitcoin miner DMG Blockchain Solutions Inc., observing its effectiveness under various on-chain transaction volumes. An alternative approach involves exploring private channels like the Lightning Network or smart contracts, although this may introduce complexities in implementation.
The proposed solution aims to achieve decentralization, ease of implementation, and trust independence while distributing incentives effectively to promote environmental sustainability within the Bitcoin network.
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