CEO of Koinos Group, creators of the Koinos blockchain
I’m Andrew Levine, CEO of Koinos Group, creators of Koinos, the blockchain with No Fees. I’m joining forces with the creator of gFam, on a new podcast: Our Decentralized Future. Adam and I are both deeply committed to accelerating the arrival of a more decentralized future which is why we do what we do.
Building a more decentralized future is going to take an unimaginable amount of education and work so in this podcast we will aim to discuss important insights that we gain from being on the front lines building decentralized products that attempt to rival centralized incumbents.
In the first episode of the podcast we discuss a wide range of topics from the different between price and value, to the energy consumption of Bitcoin, and the role that marketing plays in decentralized businesses.
One of the most important points that I made in this episode has to do with economic growth and what causes it. Nothing is more highly correlated to economic growth than CO2 output. Now that doesn’t mean that we should start burning even more fossil fuels so that we can get more economic growth. That would be like accelerating faster toward a cliff.
Order v. Chaos
The reason why CO2 output and economic growth are so tightly correlated is because burning fuels is the primary mechanism that we use to generate energy which is what we use to structure the world around us (i.e. create order) while the universe is trending toward entropy (i.e. chaos).
This enables us to understand the concept of value as some function of energy input and order output. Bitcoin may consume a lot of energy, but how much order does it create? Bitcoin enables people from all over the world to coordinate their activities through a peer-to-peer network and both the fees that they are willing to pay and the market capitalization of that platform are indicators of how valuable those people find that product.
Decreasing Blockchain Waste
I believe it is entirely possible that Bitcoin provides incredible value for the energy that it consumes, and ultimately that is what really matters. But that also doesn’t mean that Bitcoin couldn’t be more efficient. The proof of work consensus algorithm securing Bitcoin is absolutely more secure than the proof of stake algorithms that so many other blockchains are implementing in an attempt to improve scalability, but it is also far more wasteful.
The goal then should be to find a consensus algorithm that is just as secure as the proof of work algorithm implemented in Bitcoin, and just as efficient as the proof of stake algorithms being implemented in other blockchains. Until this is done, then the value that Bitcoin users get from its security, stability, reputation, and deep liquidity, will likely continue to justify its incredible price.
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