FTX founder delivered shocking criticism towards the world’s biggest digital currency. The billionaire chief said that Bitcoin has issues on inefficiency and environmental costs. Financial Times reported on Monday, noting that the FTX’s founder, cryptocurrency exchange argued that Bitcoin has no future as a payment network.
Proof of work is a process in bitcoin where computers mine the currency by solving complex puzzles. In order to support this system, a huge amount of electricity entails. In order to join the network, participants have an alternative way to the system. The name is poor of stake. Here, the participants could purchase tokens allowing them to participate. In other words, the more they own tokens, the more they can mine.
Sam Bankman-Fried, founder of FTX and Chief Executive told Financial Times that proof of stake networks is a vital requirement. It evolves crypto as a payments network because they are cheaper and less powerful. Etherum, the second largest cryptocurrency ether blockchain, has been working to shift to a more energy-intensive network.
Meanwhile, Bankman-Fried added that he has no trust in Bitcoin as a cryptocurrency. Based on the report, the future of Bitcoin could be just as an asset, a commodity, or a store of value. It is almost the same as gold. Since December 2020, two years ago, Bitcoin has faced severe lows following the collapse of TerraUSD. The so-called stablecoin faces downfall.
Based on Forbes’ elaboration, FTX, co-founded by Bankman-Fried in 2019 valued at $32bn. Bankman-Fried himself owned $21bn. He believed that Bitcoin is not suitable enough for a payment network. He clearly told the media that Bitcoin is neither a payment network nor a scaling network. Proof of Work is significant to give validation on transactions. It means that it works non-stop to verify.
