Do you mind commenting quickly on alternative consensus mechanisms that are being proposed in different blockchain environments? How does that impact crypocurrency space, what is your view on the private versus public blockchain space?
I think consensus algorithms are a very interesting area. It is basically a new science. It has been growing since January 3rd 2009, when there was only one blockchain.
If you look at the number of academic papers published on this topic, it has been growing at a hyperbolic rate. Maybe you did not know, but hundreds of PhD dissertations and papers on consensus algorithms was way back in 2015. It is increasing since then exponentially, and I only expect that pace to increase.
I expect to see entire masters degrees, post-graduate or PhD programs focused on consensus algorithms. There are many interesting experiments in that space.
To me, the important part is to run your experiment in the wild, at scale, with real actors and real money at stake, and see how it survives in those conditions. This is NOT a theoretical science. This is an experimental science. We can run experiments on a global scale, and prove these systems work in real terms. To use the trite expression, that is “where the rubber meets the road.”
Until we see large-scale deployments of novel consensus algorithms that are practical to use, I know only one that is proven and battle tested thoroughly today: that is proof-of-work. We will see what comes next.
That doesn’t mean you can’t do it another way, but we must recognize that other consensus algorithms will produce different characteristics and features. Proof-of-work produces thermo-dynamically guaranteed immutability, something you can’t do any other way.
With proof-of-stake, maybe we will see different results, features, and characteristics.
This is a broad ecosystem in which different systems can specialize for fitness in particular niches, applications, and use cases. There is plenty of room for competition.
This is not the old zero-sum game of national currencies, where there can only be one in any particular domain, and it is winner-takes-all. That is not what we are doing here. It is a completely different game, where game will win.