Stevan Lohja, the technology coordinator at Ethereum Classic Labs, a San Francisco-based Ethereum Classic (ETC)-related blockchain incubator, has argued that Proof-of-Stake (PoS) consensus algorithms are a “red herring for incorporated through blockchain.”
In his interview with CryptoGlobe, Lohja explained: “Proof-of-Work (PoW) has miners that stake in hardware, energy, and investment. By definition, anyone storing value on-chain has a stake in the chain. PoS chains are incorporations through blockchain because stakers are shareholders and gain voting and validation privileges solely based on x amount of shares.”
Distributed Consensus On Blockchains: PoW vs PoS
While comparing PoS consensus to PoW, Lohja noted: “In PoW, miners have to constantly work to maintain their stake in the network. In PoS, you just show shares and get a handout of privileges along with dividends – aka stake rewards.”
When questioned about the importance of immutability for blockchain networks, Lohja stated:
ETC’s value proposition is decentralization, immutability, backward compatibility. and Proof-of -Work. You need immutability to be decentralized because the state of your value needs to be censorship resistant so no one or group can manipulate your value on chain. That's the entire catalyst for the inception of cryptocurrency after all.
Private Blockchains May Have Legitimate Use Cases
In response to a question regarding whether private, permissionless blockchains have any potential use cases, Lohja said:
Private chains do have a legitimate use case. For example, Lego makes millions if not billions of lego bricks that have unique identifiers. Recording all these bricks in a public chain isn't feasible and the data is arguably not that valuable. Lego may not care about the price in their blockchain database so they may want an artificially inflated chain to contain their records of bricks.
Lohja continued: “However, this can be done as a Layer 2 model backed up by a public blockchain such as Ethereum Classic which helps private L2 solutions give more of their verification overhead to public chains than maintaining it completely themselves.”
Relationships Between ETC And ETH-Related Organizations
Responding to a question about the role of IOHK, ConsenSys, and other organizations supporting the role of Ethereum Classic development, Lohja remarked:
ETC Labs Core hired Zack Mitton, who previously worked at ConsenSys, and ETC Cooperative hired Bob Summerwill, who also worked at ConsenSys and Ethereum Foundation. As Ethereum Classic continues to grow, I think you'll see many ETH contributors [potentially start] working on ETC. I think the community in general, can help attract more growth by creating more non-profit organizations.
He added: “ETC had ostracized the idea of foundations and lack foundations largely because of the DAO hack and how Ethereum Foundation has the Ethereum trademark and by law can enforce that trademark to competitors.”
According to Lohja, ETC might be more decentralized than ETH because:
Since we don't have the centralized trademark, we'd arguably be more decentralized than EF with many ETC development based non-profits all contributing to Ethereum Classic. People with a lot of capital have tax incentives to donate to non-profit RND groups. ETC needs to get into that share of funding!
When asked to comment on the latest Ethereum (ETH) network upgrade, Lohja noted:
The latest ETH fork was Constantinople and there was a re-entry bug discovered. We believe strongly in battle tested implementations and treading slowly in regards to hard forks.