The XRP creator proposes an approach to get Bitcoin miners to quit Proof-of-Work.

Chris Larsen, the creator of XRP and the executive chairman of Ripple, has revealed a proposal to persuade Bitcoin miners to move to a more ecologically responsible consensus process, such as Proof-of-Stake.

Larsen suggested methods Bitcoin miners could do to decrease the network’s energy use. He stated that miners should see the shift to a low energy consensus method, such as the one employed by most leading crypto protocols, as a “net positive for their survival.”.

The Bitcoin blockchain is powered by the energy-intensive Proof-of-Work (PoW) consensus process. The pioneer cryptocurrency is frequently criticized by cynics who point out that system needs a lot of energy each year and competes with the majority of the world’s governments. Many people believe that rising Environmental, Social, and Governance (ESG) issues are preventing several major corporations from adopting Bitcoin.

Larsen’s recommended “least disruptive” method would “take a snapshot of existing miners’ current hash rate and then award miners on a pro-rata hash power basis.” This would provide present miners with the access to future BTC payments without requiring them to utilize more energy or invest in new mining equipment. In other words, his technique would provide miners with “additional economic benefit,” since they would generate the same profit while incurring substantially lower operating costs.

Larsen proposed the following system to explain how it might work:

“Consider Marathon Digital, which runs 8% of the current global hash rate, earning 75 BTC per day as of November 1, 2021. Under such a code change, Marathon would continue to earn 8% of daily Bitcoin rewards but would not need to expend any energy to receive this reward.”

Furthermore, current miners would profit from a long-term revenue stream since their rewards may be tokenized and sold to other market participants.

Ethereum, the world’s second-largest cryptocurrency by market value, is now undergoing a Proof-of-Stake transformation. This shift, according to Larsen, will render Bitcoin a “climate outlier.”

Notably, the majority of individuals in the Bitcoin community support PoW because it is an excellent method for securing the network without sacrificing decentralization. This merely demonstrates that Larsen’s bold proposition is unlikely to receive community acceptance.

Patrick

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