Vitalik Buterin Is Concerned About Bitcoin’s Security
Vitalik Buterin, the creator of Ethereum (ETH), has expressed doubts about the security of Bitcoin (BTC) in the long run.
Vitalik Buterin outlined two reasons why he is concerned about the security of Bitcoin in the future to Bloomberg columnist Noah Smith in the interview conducted over email, published on September 2.
Vitalik Buterin worries that the fees alone won’t be enough of an incentive for miners to protect the network, which he believes has the potential to grow into a system that can handle multiple trillions of dollars.
It is crucial to remember that once all of the Bitcoin has been mined, miners who verify transactions or blocks will only be qualified to receive transaction fees as rewards. Buterin contends that it is extremely unlikely that the Bitcoin network will be able to generate the quantity of fee revenue required to keep the system operational.
“First, in the long term, Bitcoin security is going to come entirely from fees, and Bitcoin is just not succeeding at getting the level of fee revenue required to secure what could be a multi-trillion-dollar system. Bitcoin fees are about $300,000 per day and haven’t really grown that much over the last five years,” Buterin wrote.
Second issue with Vitalik Buterin
Second, Vitalik Buterin asserts that the Proof-of-Work (PoW) consensus mechanism has a flaw that could jeopardize the security of user data. Buterin asserts that Proof-of-Work provides far less safety than Proof-of-Stake for every dollar spent on transaction fees (PoS).
A successful attack on the system may be launched with just $5 billion worth of Bitcoin in the hypothetical future when there are approximately $5 trillion worth of Bitcoin, according to the person who built Ethereum.
Buterin asserts that the refusal of maximalists and miners to even consider transitioning to PoS makes the situation much more dangerous.
“Second, proof of work provides much less security per dollar spent on transaction fees than proof of stake, and Bitcoin migrating away from proof of work seems to be politically infeasible. What would a future look like when there’s $5 trillion of Bitcoin, but it only takes $5 billion to attack the chain? Of course, if Bitcoin actually gets attacked, I do expect that the political will to switch to at least hybrid proof of stake will quickly appear, but I expect that to be a painful transition” Buterin.
The Ethereum network is getting ever-closer to changing, which is worth noticing. The update, known as the Merge, is scheduled to occur between September 10 and September 20 and is predicted to reduce the amount of energy required by the supply and network.
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