Ethereum’s shift to a “proof-of-stake” system avoids these environmental costs. Ethereum now uses an algorithm that randomly selects someone to create a new block to add to the blockchain. The party is chosen from those who have staked their ether (the Ethereum blockchain’s native coin) for the chance to do the work and be compensated for it. The more ether someone stakes, the more likely they are to be chosen to create the new block. This creates incentives to acquire even more ether, and it seems reasonable to predict that any blockchain that relies on proof-of-stake will start to concentrate the ability to process transactions in just a few hands. Staking is already a highly centralised business involving some of the industry’s largest companies, such as Coinbase, according to data provider Nansen. More centralisation seems inevitable.

https://www.ft.com/content/3c64101b-c4a1-49b3-a187-30229b1e5b9d