Sam Bankman-Fried, CEO of FTX cryptocurrency exchange, believes that Bitcoin is not suitable for making daily payments due to its low scalability and negative impact on the environment.
AT interview With the Financial Times, Sam Bankman-Fried stated that Bitcoin was originally created as a decentralized alternative to the traditional financial system. Now, however, as other blockchains emerge, Bitcoin is moving away from its original purpose. According to Freed, bitcoin is not suitable for making payment transactions on a large scale. The Bitcoin blockchain, which uses the Proof-of-Work (PoW) consensus algorithm, is not able to quickly process millions of transactions around the world, and it will also cause irreparable damage to the environment. Therefore, to create a functional payment network, an alternative blockchain based on Proof-of-Stake (PoS) is needed.
“The Bitcoin network is not suitable for payments. With the same success, you can pay for purchases in stores with gold bars. It would be ridiculous, ridiculous and incredibly expensive. And I’m sure it would be bad for the environment,” says the head of FTX.
He added that bitcoin is not going anywhere, as it serves as a much better store of value, and many cryptocurrency enthusiasts agree with his opinion. For example, Galaxy Digital founder Michael Novogratz is confident that investing in bitcoin can save investors’ funds from the depreciation of national currencies. However, the governments of El Salvador and the Central African Republic, where bitcoin is legalized, have high hopes for it as a means of payment.
Earlier, Elon Musk, CEO of Tesla and SpaceX, expressed a similar point of view regarding the conduct of transactions with bitcoin. He believes that when paying with bitcoin, people are forced to pay large commissions, so the DOGE coin is best suited for making payments.