Wednesday, February 28, 2024

FTX CEO sees no future in Bitcoin payments, community fires back

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Sam Bankman-Fried, the founding father of crypto change FTX, has criticized the effectivity of Bitcoin (BTC) as a fee community, solely to satisfy heavy backlash from the crypto community.

Throughout an interview with the Monetary Instances, Bankman-Fried fueled environmental considerations related to the Bitcoin community’s mining consensus, proof-of-work (PoW), and claimed it is not scalable sufficient to accommodate hundreds of thousands of transactions.

He advocated for the usage of proof-of-stake mining consensus as a substitute and claimed it’s higher fitted to blockchain fee networks. He mentioned:

“Issues that you simply’re doing hundreds of thousands of transactions a second with should be extraordinarily environment friendly and light-weight and decrease power price. Proof of stake networks are.”

Bankman-Fried feedback resonated with the latest calls for an entire ban on PoW by a bunch of billionaire lobbyists comprising Ripple co-founder and a number of other different environmental teams. Nevertheless, Bitcoin proponents have been actively preventing in opposition to the continued narrative calling for a change in the code of the Bitcoin community’s mining consensus.

Associated: Wanting to work: Bitcoin change to proof-of-stake stays unlikely

The likes of Jack Dorsey have already made it clear that PoS is extra centralized and fewer safe than PoW.

The crypto community was not more than happy with FTX CEO’s latest feedback. Many claimed the Bitcoin community will not be supposed to be a fee community, however slightly a settlement one and layer-2 options such because the Lightning Community act as the primary fee gateway. One person wrote:

“Both SBF or FT mendacity right here. What occurs to L2 (Lightning Community)? The Bitcoin Lightning Community handles as much as 1,000,000 transactions per second!”

Others reminded him of excessive centralization and concurrent shutdowns of PoS networks comparable to Solana. One person wrote:

“Thanks god we’ve Soylana that we are able to change on and off each different week!”

One other person on Reddit wrote:

“He does not have a friggin’ clue what he’s speaking about (or the journalist interviewing him does not). Scaling has NOTHING to do with the consensus algorithm and therefore whether or not it’s POW or POS is totally irrelevant to the scaling points .”

The FTX CEO took to Twitter himself to clear the air round his feedback and mentioned that he additionally talked concerning the Bitcoin community’s potential as a retailer of worth. He mentioned:

“To be clear I additionally mentioned that it does have potential as a retailer of worth. The BTC community cannot maintain 1000’s/hundreds of thousands of TPS, though BTC could be xfered on lightning.”

The PoW vs PoS debate began final 12 months when the Ethereum community outlined its plan to maneuver to the PoS mining consensus. The likes of Elon Musk fueled the sentiment that BTC wants to make use of extra clear power to be a viable possibility. Nevertheless, in 2022, the talk appears to have shifted in direction of an entire change of mining consensus for the BTC community.