Bloomberg interviewed Strike founder Jack Mallers. More businesses, governments and people around the world are using Bitcoin every day.
During the Bloomberg Crypto Show yesterday, July 19, Matt Miller spoke to the founder and CEO of Strike, Jack Mallers. The interview, which initially was mainly about how Mallers learned about crypto and how he established his company Strike, arrived at the question of “Proof-of-work or proof-of-stake?” Mallers began with the statement that using energy is not a bad thing. “Engineering and the use of energy is implied in the growth of humanity.”
Watch the full interview here:
One of the many arguments that bitcoin critics love to bring up in discussions is how bitcoin mining uses a lot of energy.
Bitcoin Is Liability-Free Money, Mallers Argues
Mining bitcoin is the process of solving complex cryptographic equations to validate transactions and mine new blocks. This process of validating is considered much more secure than banks because the records are public which makes it impossible to fake a bitcoin. Bitcoin’s proof-of-work consensus mechanism currently consumes an estimated 150 terawatt-hours of electricity annually.
On the other hand, Proof-of-Stake implements randomly chosen validators to make sure that the transaction is reliable. In this definition of Proof-of-Stake, Mallers argued that there is a “liability relationship”. Because unlike stablecoins or stock shares or securities that have a liability, Bitcoin’s proof-of-work mechanism “is not a proxy to some foundation, some team, some corporate structure, [Or] some development decision,” basically saying that the relationship is not a liability.
Mallers proceeded and continued to explain that “in theory what you want is a monetary asset where there is no liability relationship. That’s the whole point of the thing. That’s what proof-of-work solves.” He then gave a picture that “if proof-of-work is like we finally have a plane, proof-of-stake is like we know how to make it cheaper, faster and less carbon efficient just by not flying. That’s not like a competitor. That’s just a totally different product.”
The Hard Work Behind Proof-of-Work
The Bitcoin mining space has attracted an incredible amount of interest over the past few years. But many interested parties lack the understanding of what Proof-of-Work mining is and why it’s so important. This lack of understanding also comes from the fact that you cannot truly understand bitcoin mining unless you try it.
To be a successful bitcoin miner, you need to have some sort of edge over the competition. Going in with a “How hard can plugging in computers be?” attitude is a big no and having access to capital is not a guarantee that you will make it.
Not only is this market difficult from a Bitcoin-economic standpoint, but also from a manpower, hardware, regulatory and logistical standpoint.
Bitcoin Mining Is Something You Have to Experience First-Hand
Kaboomracks Alex in his article “The Proof of Work Behind Proof-of-Work – Bitcoin Mining Profitability Doesn’t Come Easy” gave a long, thorough explanation on everything you need to consider when venturing into the bitcoin mining business.
He listed things such as hardware, logistics, manpower, energy consumption and maintenance. Alongside the technical stuff, he also mentioned key points such as regulatory risk, geopolitical risk, your mentality as a business owner, and the security aspect.
“There is nothing simple about Bitcoin, and there is absolutely nothing simple about mining bitcoin,” He wrote, “The average Bitcoin user will never understand the heartache that goes into mining Bitcoin but will still experience the benefits from it.”
The constantly changing nature of the market always challenges miners to adapt and adjust accordingly, and there is no easy path.
