Long Time Bitcoin Advocate Jeff Garzik: “Crypto Industry Suffers From a Major Economic Paradox”


 

  • According to Garzik, BTCs current funding model is “not sustainable” and will adversely affect the premier asset in the coming few years.
  • He also believes that as we move into the future, we need to figure out a way in which to keep BTCs native tx costs at a bare minimum.

During a recent interview with respected Bitcoin developer Jeff Garzik, the crypto savant spoke at length about the various challenges facing by the altcoin industry today. Not only that, he also elaborated his stance on the “economic paradox” that is currently threatening to derail the future of Bitcoin.

Scaling is Still BTCs worst Nightmare

For those of our readers who might not be aware, Garzik was one of Satoshi Nakamoto’s earliest collaborators and has been involved with the crypto industry (in one form or the other) for more than a decade now.

When asked about what the biggest challenge facing Bitcoin today was, Garzik replied by saying that the “pace of innovation” that lay at the heart of BTC was extremely slow and that it was causing technologies like the ‘Lightning Network’ to not scale up efficiently.

In this regard, he also pointed out that as we move into the future, the exclusive nature of the Bitcoin ecosystem could alienate a lot of people from different developing nations. Further elaborating on his stance, Garzik was quoted as saying:

“That’s the top 1% worldwide. And so that tells you that, if you have to pay $10 for a Lightning transaction, that leaves Bitcoin to [people in] the US and EU and that’s it. We just excluded the rest of the world due to transaction fees.”

In Jeff’s opinion, in order for BTC to remain accessible to people across the globe, the crypto asset needs to be scaled up in a manner that helps keep the currency’s native tx fees at a bare minimum.

Crypto’s Economic Paradox

When discussing the issue of scalable technologies and how companies should go about devising such novel offerings, Garzik offered the following insight:

“It’s an economic problem of funding, It’s almost a paradox. If you’re a Zcash, for example, then in every single block, 10% of the new tokens minted go to a dev team fund to create sustainability. And so that’s good for the long-term sustainability picture, but it has a downside. It’s a centralized fund, and it goes to a centralized team or whoever is holding the keys.”

Final Take

Last but not least, Jeff is of the opinion that BTC does not make use of a sustainable funding framework. As a result of this, developers often have to resort to using a one-time cost model — wherein they try to procure funds independently as per their individual needs and requirements.

Bitcoin’s price is $45,088.79 BTC/USD exchange rate today. The real-time BTC market cap of $843.7 Billion currently ranks #1 with a chart dominance at 62.37%, daily trading volume of $30.45 Billion and live coin value change of BTC -6.58 in the last 24 hours.

Live Bitcoin (BTC) Price:

1 BTC/USD =$45,088.7932 change ~ -6.58%

Coin Market Cap

$843.7 Billion

24 Hour Volume

$30.45 Billion

24 Hour VWAP

$47.47 K

24 Hour Change

$-2,966.24

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