Recently, David Schwartz, the CTO of Ripple and co-creator of XRP, made a prediction about the long-term viability of Bitcoin and proof-of-work chains. This prediction has been met with some controversy in the cryptocurrency community, particularly among those who are strong supporters of Bitcoin.
In contrast to Bitcoin, the XRP Ledger is expected to continue thriving and adoption of the cryptocurrency is increasing. This is likely due, in part, to the fact that XRP is known for being one of the most stable and reliable cryptocurrencies on the market. Unlike Bitcoin, which has a reputation for being prone to drama and controversy, XRP is often referred to as “boring” because it simply works without any major issues.
In other news, CoinDesk recently published an article about Sam Bankman-Fried, the CEO of cryptocurrency exchange FTX, and his shrinking $250 million bond. Bankman-Fried has been granted bail, but the collateral put up for the bail was only a fraction of the $250 million amount. This has led some people to speculate that Bankman-Fried is receiving special treatment.
The Bitcoin Archive Twitter account, which has over 1.1 million followers, also recently tweeted about Bitcoin miners in Texas who were forced to stop operations due to power outages caused by extreme winter weather. This highlights one of the key vulnerabilities of Bitcoin and other proof-of-work cryptocurrencies: their reliance on mining operations, which are susceptible to events like power outages and government intervention. This vulnerability could potentially undermine the long-term viability of proof-of-work chains like Bitcoin.
In a recent discussion on this topic, a community member asked David Schwartz if he thinks the Bitcoin network will continue to operate if the cost of mining is higher than the profit. Schwartz responded that this will reduce the number of miners, which will in turn decrease the mining difficulty and raise the profitability of mining. However, another community member asked if Schwartz sees Bitcoin mining still existing past 2030, given that governments are increasingly pushing for a more sustainable, green future.
In response, Schwartz stated that he doesn’t think proof-of-work will go away completely, but he does believe that its popularity will decrease over time. He also suggested that there may be room for at least one proof-of-work chain to remain in operation for a long time, though he hopes that it won’t be Bitcoin filling that particular niche. Schwartz didn’t elaborate on why he hopes this, but it could be due to concerns about the energy intensity of Bitcoin mining.
Despite this, the speaker in this discussion acknowledged that, at least for now, Bitcoin is only a small percentage of global energy consumption and is therefore not a significant contributor to environmental issues. However, the speaker also argued that this is not a good reason to continue using inefficient technology like proof-of-work, especially when there are better alternatives available.
In fact, the speaker believes that proof-of-work is inherently inefficient and wasteful, and that it is only a matter of time before there is a shift away from proof-of-work towards more efficient and scalable consensus mechanisms. This shift is likely to be driven by a combination of factors, including concerns about the energy intensity of proof-of-work, the vulnerability of mining operations to external events, and the desire for more sustainable and environmentally-friendly technologies. While it remains to be seen what the future holds for proof-of-work and Bitcoin, it is clear that there are strong arguments for exploring alternative consensus mechanisms in the long-term.