Building better blockchains is surprisingly hard

According to its fans, crypto is the key to paradise, particularly the financial kind. Greedy intermediaries, such as banks, will be replaced by smart contracts (self-executing rules) that run on blockchains (distributed databases). This will give rise to efficient and innovative financial services, collectively called “decentralized finance” (DeFi).

The foundations of this structure are shaky, however. Today’s blockchains may be masterworks of coding, but they are also fiendishly complex, energy-hungry and, perhaps counterintuitively, centralized. Despite years of work, crypto developers are still trying to fully overcome the trade-offs inherent in the technology. 

Read the the full article in The Economist HERE.

Bitcoin is setting the world on fire

Bitcoin was really hot in 2021, but not the way you might think. 

I'm talking about the massive energy and carbon footprint that has bloomed up as the Bitcoin network continues to grow. We've finally started to pay attention to it in 2021, with Elon Musk calling its energy consumption "insane," and calling into question its usefulness (and interestingly neither Tesla nor Musk have divested themselves of Bitcoin holdings).

It's true that Bitcoin uses an absurd amount of energy, and 2021 was the year that it truly skyrocketed, rising from somewhere around a 77 TWh/year forecast in the beginning of the year to more than 200 TWh/year by December 25. At this point, the Bitcoin network is burning through the same amount of power and fuel as some medium-sized countries, and an individual transaction eats up more power than an average U.S. household uses in 70 days!

Bitcoin, and other cryptocurrencies, need something big, like a transition to proof-of-stake, if they're going to survive a larger global transition to greener energy.