BitTorrent Creator Advises Ethereum Developers to Not Switch to Proof-of-Stake

Bram Cohen, an American computer programmer and the author or peer-to-peer (P2P) file sharing protocol and software program BitTorrent, has advised Ethereum’s (ETH) developers to not switch to the proof-of-stake (PoS) consensus protocol.

Cohen also suggested that Ethereum’s development team “separate out state transitions from their justifications” and “drop” sharding - as they work on upgrading the Ethereum blockchain network. In response to Cohen’s recommendations, Twitter user “WallStreet 5” (@Street5Wall) asked Blockstack co-founder Muneeb Ali why his platform couldn’t be deployed on Bitcoin SV, “instead of Ethereum.”

Clarifying that Bitcoin SV, a fork of Bitcoin Cash, is “not designed as a general purpose” platform to launch decentralized applications (dApps), Ali explained that Blockstack is “explicitly designed” to facilitate the development of distributed apps.

Responding to Ali’s comments, Craig Steven Wright, the self-proclaimed inventor of Bitcoin, claimed that Bitcoin (as he envisions it) “is a Turing Complete system.” Wright also argued that Bitcoin is capable of functioning as a dApp deployment platform and it has many other use cases.

SegWit Was "More Of A Bug Fix"

Meanwhile, Twitter user “Critical I.” (@critical_infras) asked if separating state transitions is what SegWit (“Segregated Witness”) did for Bitcoin. According to Cohen:

Sort of. SegWit was more of a bug fix than a change to the model. Yeah Satoshi meant for the UTXO (unspent transaction output) model to begin with but messed up that detail mistakenly thinking signing more stuff was better.

Questioning whether it’s a good idea to “drop stated goals” and if Cohen thinks they’re “unobtainable”, Twitter user @CogentConch pointed out that “many people are invested in ETH because of [the] upcoming” proof-of-stake (PoS) upgrade to the Ethereum network. Per the BitTorrent creator, the “current plans” for doing state transitions on Ethereum are “unworkable, or are only workable by letting the thing continue to quickly backslide into centralization.”

"Hard To Explain" To Those Who Don't Have A Technical Background

Acknowledging that state transitions and other implementation details related to Ethereum are “hard to explain without assuming quite a bit of technical background for the reader”, Cohen noted:

The idea is to have 'transactions' in the database sense, so they have clear dependencies and [users] know in advance exactly how much gas they'll need ... Basically every detail of a transaction's execution and the amount of gas it uses should be precisely specified up front and the slightest deviation from that should make it fail.

In October 2018, Cohen had announced his plans to launch a new cryptocurrency (called Chia) based on a “proof of space” consensus protocol - which he claimed was a more eco-friendly version of Bitcoin (BTC).

Advantages of Securing IoT Devices with Blockchain, Explained By Andreas Antonopoulos

Andreas Antonopoulos, a widely-followed Bitcoin (BTC) specialist, has argued that using blockchain to solve internet of things (IoT)-related security issues may not have any significant benefits.

Antonopoulos, whose comments came during a recent Q&A session, published on May 17, 2019, said it’s possible that a traditional database management system could work just as well (as a blockchain) when it comes to securing IoT-based applications.

Logging Information From IoT Devices Using Blockchain-based Systems Could Be Beneficial

However, Antonopoulos acknowledged that distributed ledger technology (DLT)-based systems could be useful in cases where “information is logged from IoT devices in a way that it maintains that information so that it can be changed in the future … so this [would be] an immutability benefit.”

He added that many people use the term blockchain to refer to databases that are able to register digital signatures (PKIs). Antonopoulos clarified:

I think that it’s important to clarify that the purpose of a blockchain is more than recording digital signatures, [or digital timestamping]. We’ve had PKI for 25 years. There’s nothing new there and it’s not particularly interesting to take a PKI database and make it public - unless you do something with it like … building a decentralized consensus system so you can have immutability.

He continued:

And then again, what problem are you solving? What are the problems in IoT security [that you’re trying to address?] A lot of people are trying to mash these two terms (IoT and blockchain) together.

According to him, there are great security risks involved when implementing IoT-based systems.

Solar Energy Trading On Blockchains

Responding to a question about the potential benefits of using an ERC-20 compliant token, instead of just using ether (ETH), when conducting solar energy trading on the blockchain, Antonopoulos first clarified that ETH is generated by mining on the Ethereum network.

He further noted that “if you have an ERC-20 token that’s related to solar energy, then perhaps you can mine, or mint, or issue that token in response to people generating energy. So, they can earn that token directly when producing energy. But the only way you can really measure how much energy somebody is producing in order to issue a token is to buy and use that energy. And in that case, [you] could just pay in ether.”

Antonopoulos also argued that tokens are not required in all cases and that users should exercise caution when new projects are trying to offer a native token.

“Markets Are Just Human Behavior”

The data communications and distributed systems graduate from the University College London also pointed out that blockchains “operate as markets” and they operate by “using markets.” For example, there’s a market for cryptocurrency mining which is based on a blockchain network, Antonopoulos explained.

There are also markets, Antonopoulos noted, for proof-of-work (PoW)-related mining profitability and “there are currency markets within the cryptocurrency space.”

He added:

All of these markets exist because of blockchains. [Therefore,] markets are a critical application of blockchain technology. Blockchains will create better, more fair, more transparent, more open markets...wherever markets are needed. Interestingly enough, even in places where markets are needed but not wanted….[For instance,] drug markets...Why? Because drug markets are [just] markets...Markets require two things in order to happen: supply and demand....Markets are just human behavior.