Dan Held, head of marketing at the cryptocurrency exchange Kraken, believes that along with the transition of Ethereum to the Proof-of-Stake (PoS) algorithm, many problems will appear in the crypto industry.
Dan Held shared his thoughts on how the Ethereum merger will impact the cryptocurrency industry in a recent podcast. In particular, he believes that the transition of the network to the PoS algorithm will be an excellent argument in the hands of environmentalists against Bitcoin, which uses the energy-consuming Proof-of-Work (PoW) consensus mechanism.
“I am sure that the upcoming Ethereum merger will significantly increase the pressure on Bitcoin due to its energy consumption. Environmentalists will point to Ethereum and say, “Hey, this blockchain uses very little energy, unlike Bitcoin.” At the same time, they will not go into details about what a proof of work algorithm and a proof of stake algorithm are,” Held said.
He also pointed out some of the security issues that the upcoming merger could bring. According to him, the network will theoretically be able to control a few large companies with the largest shares in it, and by government decree block objectionable protocols. Because of this, a “catastrophic failure” can occur, which will put the entire network at risk. The Bitcoin community does not want to take such risks, Held says, and therefore remains on the PoW algorithm.
Held added that many companies, especially those in Europe, are currently reviewing their ESG (environmental, social and corporate governance) policies, the set of principles that they use to build their businesses and which include moderate energy consumption. Due to the recent sanctions from Russia, Europe will have to adjust the ESG policy, and this will benefit Bitcoin.
Previously, Bits.media published an overview material, which looks at how the crypto industry is responding to the Ethereum merger, as well as what measures are being taken to prepare for it.
Source: Bits
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