Lisk (LSK)

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Field

Content

General information

S.1

CASP Name

BB TRADE ESTONIA OÜ

S.2

Relevant legal entity identifier

984500L05A5D0E66Q610

S.3

Blockchain network name

Lisk

S.4

Name of the crypto-asset

LSK

S.5

Consensus Mechanism

Delegated Proof of Stake (DPoS)

S.6

Incentive Mechanisms and Applicable Fees

Lisk operates on a Delegated Proof of Stake (DPoS) consensus mechanism. LSK token holders participate in governance by voting for Delegates (active block producers). The top 101 elected Delegates are responsible for forging new blocks, validating transactions, and maintaining network security. 

Incentives: Delegates are rewarded with newly minted LSK tokens for successfully producing blocks. A common practice among Delegates is to share a portion of these rewards with the voters who elected them, incentivizing token holders to stake their LSK and participate in selecting reliable Delegates. This aligns the economic interests of all participants with network health and security. 

Fees: Transaction fees on the Lisk network are paid in LSK and are designed to be low and predictable to encourage widespread adoption. These fees are collected by the Delegates who forge the blocks, serving as an additional incentive for their operation. The DPoS model is inherently energy-efficient, as it avoids the competitive computational race of Proof of Work.

S.7

Beginning of the period to which the disclosure relates

2024-01-01

S.8

End of the period to which the disclosure relates

2024-12-31

Mandatory key indicator on energy consumption

S.9

Energy consumption

~150,000 kWh per calendar year

S.10

Energy consumption sources and methodologies

The energy consumption of the Lisk network primarily derives from the electricity consumed by its 101 active validator nodes (Delegates) and any supporting full nodes or RPC infrastructure. As a DPoS network, it does not involve energy-intensive mining. Methodologies for estimation typically involve:

Hardware consumption: Analyzing the typical power draw of standard server hardware used by DPoS validator nodes.

Node count and uptime: Scaling this hardware consumption by the known number of active Delegates (101) and their continuous operational uptime.

The design of DPoS inherently minimizes computational energy requirements by relying on elected delegates rather than a global competition.

Supplementary key indicators on energy and GHG emissions

S.11

Renewable energy consumption

n/a

S.12

Energy intensity 

~0.137 kWh per transaction

S.13

Scope 1 DLT GHG emissions – Controlled

0 t CO2eq per calendar year

S.14

Scope 2 DLT GHG emissions – Purchased

~71.25 t CO2eq per calendar year

S.15

GHG intensity 

~0.065 kg CO2eq per transaction

S.16

Key energy sources and methodologies

The energy sources for Lisk's DPoS validator nodes (Delegates) are those of the data centers and cloud providers they utilize. These sources reflect the diverse electricity grid mixes (conventional and sustainable) of their global or regional distribution. Methodologies for assessing this would involve:

Geographic identification: Attempting to identify the physical locations of the active Delegates.

Grid mix data correlation: Integrating this location information with publicly available datasets on national/regional electricity generation mixes and their associated carbon intensity factors (e.g., from IEA, EIA, regional energy authorities). The limited and known set of active delegates makes this estimation more feasible than for fully decentralized PoW networks.

S.17

Key GHG sources and methodologies

The predominant source of Greenhouse Gas (GHG) emissions for Lisk Chain is Scope 2 (indirect emissions from purchased electricity). Methodologies for estimating these emissions involve:

Energy consumption * Emission Factor: Multiplying the estimated total electricity consumption of the Lisk network (S.8) by the carbon intensity (grams of CO2 equivalent per kWh) of the electricity mix used by its Delegates.

Focus on operational emissions: The calculations primarily focus on the operational energy usage of the DPoS validator nodes, which constitute the main energy-consuming component of the chain. Emissions from hardware manufacturing (Scope 3) are typically outside the scope of such operational reports.