Bitcoin’s growing energy needs? Proof-of-gaming is better than that.

Proof-of-gaming is a novel concept and it’s a simple one at that. According to Ulti Arena – an NFT marketplace for game assets, it’s the answer for the ongoing increase in the bitcoin mining energy consumption problem. The more you play, the higher the chances of mining the next block of coin.

Bitcoin’s energy consumption problem

But first, let’s start with the problem. Was Elon Musk right to voice his concerns over the “rapidly increasing use of fossil fuels for bitcoin mining.”? By some measures, the cryptocurrency uses more energy than entire countries such as Sweden and Malaysia. According to Cambridge Bitcoin Electricity Consumption Index – in its peak, on May 10th, 2021 – the upper bound consumption on that day was 510 TWh and the estimated consumption was 148 TWh.

Figure 1 – Bitcoin mining energy consumption in TWh

For comparison, let’s take a look at the energy consumption of the entire nation of Sweden – while its production topped 160 TWh – the country’s usage has steadily declined in the last few years to less than 140 TWh.

Figure 2 – Energy consumption and production in Sweden

Energy consumption is not the only problem that Bitcoin mining creates. NVidia has an ongoing shortage of GeForce RTX series graphics cards – which pressures the prices and also has gamers scrambling to find one to buy from the market.

Proof-of-gaming concept

Now here comes Proof-of-Gaming – an idea integrating gaming and blockchain technology. Key advantages of using proof-of-gaming:

  • It is more energy-efficient than Proof-of-Work (Bitcoin),
  • Certainly more fair than Proof-of-Stake (Ethereum) – where it favors nodes that have the largest ETH stake in the network,
  • It’s just more fun – playing the game while mining and earning passive income? You bet.

The Proof-of-Gaming algorithm’s main idea is that gamers who spend time and GPU computational power should be the ones that could create and validate blockchain’s new blocks. 

To implement this, there are certain conditions that have to be met:

  • The game should be difficult enough for bots to emulate and challenge human players, such as DOTA2 (while the Open.AI is increasingly masterful in handling human gamers – it’s not open-sourced and the team behind it are world-class computer and data scientists),
  • The choice of team-play based games is obvious: in a complicated setting such as 5v5 gameplay, the number of combinations of strategies based on the different kinds of characters chosen, weaponry and playstyle are nearly infinite,
  • Data from the game itself should be available to developers, one great example is Valve’s STEAM API,
  • The mining algorithm should take minimal CPU/GPU/RAM resources to increase FPS while playing online games.

Rules for creating and validating blocks

Key parts of the validation algorithm are:

  • Player’s rank in comparison with other players,
  • Time spent in-game,
  • Core playstyle metrics: APM (Actions-Per-Minute), Aggression, TeamPlay, Economics, Leveling Speed, etc. 
  • Game difficulty.
Figure 3 – Valorant’s rank distribution 2020

Sounds intriguing? Then you know what to do. Step up your crypto game to get the best out of it! 

This guest post from the Ulti Arena Team was edited by We hope you got a good understanding from this article of their innovative new consensus protocol, Proof of Gaming!