The biggest critics of the Bitcoin mining industry consistently list energy consumption as a limitation of digital asset mining, and Ripple co-founder Chris Larsen thinks he may have a solution for it. problem in his most recent blog. Larsen, who is also the executive chairman of Ripple Labs, recommends Bitcoin miners move from the existing, energy-intensive Proof-of-work (PoW) algorithm to an energy-efficient PoS (PoS) protocol. than. He added that these miners should view his plan as “a net positive for their longevity” while adding that he’s looking at how the switch could benefit them. mining companies.
Larsen notes that the only way to transition to low-energy consensus could be achieved through a change in the network’s code – a change that would dramatically disrupt the very nature of the network. Bitcoin network.
While this is early stage (and not perfect by any means), I believe that if miners continue to receive BTC incentives BY code change, this could get them on board. Let’s discuss. 2/2
– Chris Larsen (@chrislarsensf) December 9, 2021
Proof-of-work is the consensus algorithm that secures Bitcoin transactions on the blockchain. Although the Bitcoin network is the most secure and reliable, the amount of Bitcoin mining power required causes endless debate in the crypto space.
“The least disruptive proposition would be to simply take a snapshot of the current hash rate of current miners and then reward miners on a proportional basis of hash power until 2140, ” Larsen said in Medium post. “Existing miners simply have the right to receive Bitcoin rewards in the future without the need to further invest in mining platforms.”
According to Larsen, his proposal is fair because it rewards miners for their efforts in securing the Bitcoin network over the years with lower operating costs. He concluded: “Under such a proposal, miners would gain an additional economic benefit – achieving the same revenue with significantly less operating costs. For better network security, Larsen writes that the proposal could be modified to include a staking mechanism.
The billionaire also hinted that the network could share future rewards among miners. He said that such an upgrade will be very profitable for miners, especially as the entire network transitions to a completely green financial technology.
The chances are very low that this proposal can be implemented as Bitcoin miners currently planning to increase their hash rate will miss out on important revenue. A wide range of US miners have been considering the use of green energy sources, for those moving to PoS will make no sense. There is also an inherent problem with the proof-of-stake model and that is its impact on the security of blockchain, a problem with no solution unless there is a ready modification to Larsen’s proposed proposal.
