Charles Hoskinson clear on Ripple case: XRP is a commodity like Ethereum, ADA and Bitcoin

Charles Hoskinson

In a Twitter video, Cardano founder Charles Hoskinson is convinced of Bitcoin and compares it to gold. 

In his opinion, Bitcoin does not need its own blockchain to remain relevant as digital gold.

Cardano founder Charles Hoskinson has made a provocative claim about Bitcoin in relation to the future prospects of his own project. According to him, there is a possibility that soon most bitcoins will be found on the Ethereum and Cardano networks:

“In just five years, most of the bitcoins being mined will be on the Cardano and Ethereum chains.”

In a Twitter video, he is convinced of Bitcoin and compares it to gold. Hoskinson says Bitcoin is digital gold and has its uses even without real use cases. Both bitcoin and gold mining require energy. In both cases, the cost of production and scarcity factors reflected the true value of both assets. In addition, Bitcoin’s current price reflects its “cost of production”. Hoskinson argues that a similar theory applies to gold.

“Just as gold would be valuable even without the producers, Bitcoin would be valuable even without mining. In this case, the value would… even increase, since the future supply would no longer increase.”

According to Hoskinson, Bitcoin does not need a blockchain to remain relevant as digital gold. This is a result of the existence of blockchains like Cardano or Ethereum and the leverage of competitors’ smart contract programs that Bitcoin can transition to. From now on, users can take advantage of wrapped tokens to send Bitcoin to the Ethereum or Cardano network.

Hoskinson: Bitcoin has failed as a decentralized asset

Hoskinson predicts that the majority of all wrapped bitcoins will find their way to other chains over the next five years. The reason for this is that “gold mining is being phased out”. According to the expert, with rising energy prices and increasing mining difficulty, it will soon be too expensive to mine Bitcoin.

“Is it really a good energy investment to keep mining bitcoin for the next 100 years just to get 2 million bitcoin?”

Regardless of his belief in the asset, Hoskinson believes that the Bitcoin ecosystem cannot keep up with the development of Cardano and Ethereum.

“The bitcoin payment network is no longer useful. (…) Bitcoin is currently only optimized as a gold mine.”

In terms of energy consumption, transaction costs and smart contract functionality, Ethereum and Cardano have an advantage over Bitcoin. Bitcoin is responsible for 0.4 percent of global energy consumption, while Ethereum has saved up to 99.9 percent of energy since the merge. Hoskinson also believes that bitcoin has failed as a decentralized asset since most of the bitcoin in circulation is managed by third parties. However, in the form of Wrapped Bitcoin, Cardano and Ethereum, users could store transactions themselves and enjoy anonymity, says Hoskinson.

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