Sam Bankman-Fried stated that he does not believe Bitcoin can function as a payment network, citing the high energy requirements of its proof-of-work algorithm as well as the fact that it cannot handle millions of transactions per second. However, he believes it has promise as a store of value.
In a Monday interview, crypto millionaire Sam Bankman-Fried stated that Bitcoin as a payment network had no future. Bankman-Fried is the CEO and creator of FTX, one of the world’s most prominent bitcoin exchanges.
The thirty-year-old millionaire questioned Bitcoin’s core proof-of-work technology for its huge environmental costs and inefficiencies in verifying transactions. He said the network could not handle millions of transactions per second.
Users may, however, move Bitcoin to layer two payment systems like Lightning, according to him. Proof-of-stake networks, he added, overcome these problems.
It would be difficult to convert Bitcoin to a proof-of-stake algorithm. As a reminder, Ethereum developers have been considering a switch to PoS for several years, despite various setbacks.
While Bankman-Fried does not consider Bitcoin to be a viable payment method, he does feel it has promise as an asset, a commodity, and a store of value, akin to gold.
Following the collapse of stablecoin Terra last week, the whole crypto market experienced a significant drop. Bitcoin has already rebounded significantly, although it is still down more than 50% from its November high.
To read our blog on “In a last-ditch effort to prevent the UST stablecoin from collapse, $3 billion in bitcoin was sold,” click here.
