Ripple’s Chris Larsen Believes Bitcoin Dominance Could Fall Over Proof-of-Work’s Energy Consumption – Blockchain Bitcoin News
Chris Larsen, co-founder of Ripple Labs, has experience with bitcoin and cryptographic networks using proof of work (PoW). In his latest article, Larsen explains that the crypto industry should reconsider PoW because of its environmental impact. A Ripple executive believes that other types of consensus algorithms provide security with only a fraction of the power.
The co-founder believes that cryptographic networks using proof-of-work alternatives should consider.
With the global economy struggling after a year marked by the Covid 19 blockade and a business stalemate, many people want to tackle climate change. Chris Larsen, co-founder of Ripple Labs, wrote a blog post about the environment and why the crypto industry should reconsider the use of PoW. Larsen believes that if the Bitcoin network’s (BTC) verification model is not addressed, it will eventually lose out to a crypto network that does.
With an increasing number of individual investors and companies taking large positions in bitcoin, PoW is heading toward a level that society will not easily tolerate as the world struggles to avoid a climate catastrophe, Larsen said in a blog post. The Ripple co-founder notes that members of the Bitcoin network are committed to renewable energy and green fuels, but Larsen stresses that this is only part of the solution.
With work trials (PoW), miners secure the system and are rewarded with computing power and specialized machines. In authentication systems (PoS), in some cases the probability of fixing a block is related to the size of the rate the validator is in the system. Like miners, validation mechanisms collect rewards, but they are energy efficient, as they do not require expensive equipment or large energy sources. However, the security of the PoS system is far less proven than that of the Nakamoto consensus system or Bitcoin’s PoW system.
According to Larsen, consensus algorithms that use proof of meaning (PoS) have proven effective in ensuring their value while requiring only a small amount of energy. He understands that a consensus algorithm is needed to verify transactions and ensure the security of the blockchain.
According to Larsen, the cryptocurrency industry has had a decade to consider these alternatives, noting that many PoS and non-PoW coins have captured more than 43% of total market capitalization.
Today, non-PoW-based currencies (including the expected move to Ethereum) account for 43% of all cryptocurrencies in terms of market capitalization, and most of the new cryptocurrencies launching today choose not to use PoW. Clearly, the trend is in that direction, Larsen says.
A Ripple executive adds:
For nearly nine years, the XRP Registry has used Federated Consensus to validate transactions and provide its public ledger. It has closed more than 62 million ledgers without any downtime, consumes the energy equivalent of just 50 U.S. homes a year, and is already carbon neutral.
Numerous studies have claimed that PoW security is superior to that of federated systems and PoS.
Larsen’s blog post exhaustively discusses all the negative aspects associated with PoW consensus algorithms. However, the blog post does not present any negative arguments against the security and vulnerabilities of PoS and non-PoW components. Over the past decade, much work and research has been done showing that PoS algorithms are not as secure as PoW. For example, compared to networks like BTC, the federated consensus of Ripple or any other type of federated blockchain mechanism was considered centralized.
For example, blockchain and criminal lawyer Nikhil Mehta of Smithamundsen LLC said that Ripple’s problems with the US Securities and Exchange Commission (SEC) were triggered by the regulator’s view that XRP is a security because of centralization.
The Securities and Exchange Commission has already indicated that Bitcoin and Ethereum are not securities due to their decentralized nature, which is the hallmark of the blockchain application, Mehta noted in his article. Ripple, on the other hand, is viewed differently by the SEC. It took the position that the development and distribution of XRP was done centrally by Ripple, he added.
Moreover, Larsen’s article makes no mention of PoS money networks, which have been attacked several times in the past decade. One example is how the Tron Steemit acquisition exposed vulnerabilities in delegated silent networks. PoW and PoS systems also have different attack costs, and one paper points out that the attack cost for PoS can be reduced to zero.
If an attacker’s motivation is high enough (and it’s common knowledge that it is), he will carry out his attack for free, according to the article.
Chris Larsen of Ripple states in his article that he doesn’t think PoW models are obsolete, but that perhaps these types of networks should be separated from those that offer low-energy, low-carbon verification systems.
We need to see PoW for what it is: a brilliantly designed technology that is obsolete in today’s world, Larsen says in his blog. This is by no means to say that bitcoin and other PoW cryptocurrencies are themselves obsolete. Their wide distribution speaks for itself. But they need to move away from this early technology, which is not designed for today’s climate needs, and opt for low-energy or low-carbon alternatives to keep their bills, the director added.
I have a lot of paperwork on using bitcoin energy
A large number of papers, studies and complaints have been published in relation to the use of PoW energy. Most of this has been covered many times before in the exciting Cryptobull 2021. However, most of these arguments have been refuted, and recently a bitcoin developer claimed that bitcoin is one of the most environmentally friendly financial networks.
Moreover, not many academic papers have found security holes, attacks or vulnerabilities related to Satoshi Nakamoto’s performance verification system. Still, Larsen thinks that energy issues could become the Achilles’ heel of the Bitcoin network in the future.
I would say such a change is crucial for bitcoin to remain the dominant cryptocurrency in the world, Larsen says. PoW’s current energy needs and carbon emissions are already unacceptable: bitcoin alone consumes an average of 132 TWh per year (equivalent to about 12 million homes in the US) and emits about 63 million tons of CO2 per year, according to the CEO of Ripple Labs.
What does Chris Larsen think about PoW networks like Bitcoin and PoW consensus testing? Let us know what you think in the comments below.
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