[How Blockchain Technology Can Be Used for Green and Climate-friendly Projects]
I take interest in every interesting idea but sometimes, a little too much with blockchain, web 3 and peripherals.
Bitcoin would go down as one of the greatest inventions of the 21st century.The cryptocurrency’s underlying blockchain technology introduced us to several other possibilities, making crypto only a glimpse of what the system will power.Before Bitcoin launched, there were several iterations of cryptocurrencies, but they always lacked a significant element that rendered them not fit for public use.Bitcoin launched as a decent iteration and became what creations like eCash, B-money, Hashcash, BitGold, etc., only imagined.Of course, the mentioned crypto solutions were influential in the creation of Bitcoin , and recognition will go to the framework laid due to years of diligence and research.There are reports that the creators of these other experiments were a part of Satoshi’s mailing list and were pretty much in the loop.
Bitcoin has grown over the years, almost becoming a mainstream financial solution as it is the most dominant asset in the market, with over $3 trillion valuation at its peak.Moreover, the cryptocurrency landscape has evolved so fast since the creation of Bitcoin, leaving bitcoin in the dust regarding relevant contributions to the ecosystem.
Many crypto enthusiasts today would argue that Bitcoin does not deserve its position as the market leader, considering the landscape has moved past what the cryptocurrency offers.
This has been the basis of the Bitcoin vs.Ethereum debate over the years, with Ethereum supporters claiming a time would come soon in the nearest future when Ethereum would overtake Bitcoin as the market leader.The premise for this argument is not far-fetched as Ethereum is the most valuable network in the ecosystem, with thousands of other decentralized applications existing on it.
As a creator myself, I know what it feels like when a constantly evolving landscape invalidates my work.
That feeling plays out like you were the last to catch on to a trend when it started from you.If Satoshi Nakamoto is alive today, it’s hard to find out if he still feels as delighted as he felt when he made the first announcement about Bitcoin.
Only to come back a few years after retiring from working on the network, and the landscape has totally changed– with users questioning the use of your creation.
What makes the job easy for Bitcoin is also what makes it hard.As a first innovation, you have no holes to fill.The dilemma of being the first innovation is you’d be creating holes.The holes you have creates the possibility of getting outplayed by a second product that has come to build on your existing framework.In the Innovator’s Dilemma, a book by Clayton Christensen, he expressed the value-to-innovation relationship as an S curve.This sigmoid relationship stresses the progression of an innovation over time in relation to what the end users draw from it, which is the utility.
He explained that value drawn from a first innovation is highly dependent on the improvements the innovation can make on itself.This makes for an arguable case for logic in other industries, but the blockchain industry is much slower.A simple analogy for the book’s theory is the faster you can fix the holes you have created, the more you can retain some market dominance.
The pitfall for bitcoin in this scenario is that the blockchain ecosystem is a fast landscape with slow participants.
It is fast-evolving, and there’s a hasty hunger for the next progressive and interesting thing to come out of the landscape.Bitcoin is already behind in terms of cutting-edge solutions like smart contracts and is also not a top choice in terms of scalability.Understandably, you may not get it as right as you want it for your innovative solution, but blockchain upgrades are not the easiest things to do.
Ethereum recently had an upgrade called the Merge, in which the network transitioned from a Proof-of-Work consensus mechanism to a Proof-of-Stake consensus mechanism, making the network environmentally friendly and setting it up for several other upgrades.
Ethereum is one of the best iterations of the blockchain, and its main shortcoming is its scalability issues.Some emerging projects have tried so hard to depose Ethereum, even touting themselves as Ethereum killers, only to end up being alternatives.Ethereum understands the need for constant upgrades.As the co-founder, Vitalik Buterin, believes, the network is only 40% complete– a similar statement to Satoshi’s last message to the Bitcoin community before his disappearance.
After the Merge, there are plans for Ethereum to undergo four other processes called the Surge, Verge, Purge, and Splurge.These processes will cater to scaling, upgrading, and the evolution of the network over the next few years.
A consensus has to agree, which means over 90% of the nodes have to get involved in the process.
Consensus is not the easiest process in a decentralized protocol, especially on a network like Bitcoin, which is heavily distributed.Consensus is more like a democratic way of coming to a decision, but a small percentage of the network not agreeing to make the necessary changes would cause a hard fork.
Hard forks would usually not mean much except that the Ethereum blockchain currently has two ghost chains (Ethereum Classic and Ethereum PoW) which were a result of upgrades.
Considering how fast and frequent first innovations will have to upgrade and catch up with the market it created, bitcoin stood almost no chance of being a much more decentralized protocol.Bitcoin has had some upgrades recently, but they were a very slow grinding situation and would slow the pace of really significant moves.Of course, bitcoin is a creation anyone would be proud of.However, one can’t help but imagine what Satoshi Nakamoto thinks of it at the moment.
In the early years of bitcoin’s creation, Satoshi kept close contact with the community, making over 500 posts on the popular bitcointalk forum
Stumbling on the post attached above was an inspiration for this article.
In the post, Satoshi discusses how zero-knowledge proof could greatly improve the implementation of bitcoin(BTC).However, it didn’t seem possible while he was active.Today, zero-knowledge protocols are a great way to improve scalability on blockchain networks.
Zero-knowledge proof technologies allow one person to demonstrate to another that they know something without the prover needing to disclose the information itself.They are a privacy-improving technology since they decrease the amount of information that must be supplied between users and the scaling technology.After all, they allow proofs to be verified quicker because they do not include the full amount of information for non-private systems.
ZK-STARKs and ZK-SNARKs are two of the most promising zero-knowledge technologies today.ZK-STARK means zero-knowledge scalable transparent argument of knowledge, while ZK-SNARK stands for zero-knowledge succinct non-interactive argument of knowledge.
SNARKS have been the popular alternative with developers and emerging blockchain solutions because they offer the most convenient ways to implement.
However, one point of criticism for ZK-SNARKS is they are not quantum-resistant.As soon as quantum computing becomes widely available, the privacy systems of SNARKS will be unreliable.Although, it is also argued that this would be the least of our problems as quantum computing also poses some threat to most wallet infrastructure and the breaking of RSA encryption
There are several reasons SNARKs have been embraced at a far quicker pace than STARKs, despite the challenges associated with the setup.SNARKs were discovered years before STARKs, giving the technology advantage in terms of acceptance.One of the older digital asset initiatives, Zcash, promoted the use of SNARKs among the blockchain development community.SNARKs has the most developer libraries, published code, projects, and developers actively working on the technology because of Zcash and other early adopters.In addition to Zcash, the emerging DEX Loopring employs SNARKs.
If a developer wants to start using zero-knowledge technology, SNARKs would be significantly more helpful than STARKs.Furthermore, SNARKs are projected to need just 24% of the gas that STARKs would require, implying that dealing with SNARKs would be significantly less expensive for the end user.Finally, the proof size for SNARKs is much smaller than that of STARKs, implying that less on-chain storage is required.
In a typical world that looks forward to blockchain adoption and Bitcoin is at the top of the market, one would expect that the cryptocurrency is primed for it.Although Bitcoin’s whitepaper does not overstate any expectations for the cryptocurrency, it’s quite expected for what is perceived to be revolutionary to be close to its precedent, which at the time were traditional finance systems and service affiliations like Mastercard.
At the time of this writing, Bitcoin poses some scalability issues that cannot be ignored– offering the capability to process only about five transactions per second compared to the thousands per second offered by centralized services like Mastercard, Visa, etc.Bitcoin uses the Elliptic Curve Digital Signature Algorithm(ECDSA), which is the algorithm that ensures individual access to their wallet and control over their assets.The verification of this algorithm is inefficient such that it limits the scalability of the network.A potential solution other developers, including Satoshi, have considered over the years but could not figure out how to apply is the use of ZK-proofs.
At the time of Satoshi’s post, the existing implementations of ZK-SNARKs had scalability limitations, but they were still much better than what Bitcoin offered.
However, using modern elliptic-curve cryptographic techniques and methods for exploiting the proof systems’ field structure and non-determinism, the verification algorithm of ZK-SNARKs has gotten so much better.Even better implementations of ZK-SNARKs offer future-proof resistance to quantum attacks.
It’s also important to state that ZK-STARK has an advantage over SNARKS as it relies on hash functions rather than elliptic curves, and it’s a much better and more secure implementation of zero-knowledge proof.However, the emphasis has been ZK-SNARKs because they were the solution closest to when Satoshi was last active.While ZK-STARKS would have made for an off-chain solution for Bitcoin’s scalability issues, one can’t help but think if Satoshi thought of a layer-2 solution for Bitcoin using ZK-SNARKS.
There’s a chance he never thought of a layer-2 solution since upgrades are a tough consensus to reach.
Also, instead of having to have to read through the whole section to find out our ZK-SNARKS could have made Bitcoin better, ZCash(ZEC) is an iteration of that.The network seems to be pretty fine with only a few shortcomings; most people would agree that it’s a much better solution than Bitcoin, except that we would argue for Bitcoin’s exceptional security.
Once the first brick is laid, you don’t have to be there to see the complete house, and it would be much faster than you imagined.This has been demonstrated throughout history– technology has thrived under this model since immemorial.
The closest proof for this argument is to look at the progression of technology and the millions of years we have probably lived without technology.Bitcoin set a precedent for the use of blockchain, and I doubt Satoshi could have foreshadowed how quickly the landscape would change.
Today, blockchain has established itself as a technology sufficient for daily activities and would be central to decentralization and open governance.Blockchain is becoming the contemporary option for financial solutions, and it is mind-blowing realizing the other sectors this technology can power.Of course, bitcoin is not the first iteration of blockchain but probably the first viable iteration.We have Satoshi to give most of the credit for perfecting the mechanisms that previous iterations had trouble with.Creating such a revolutionary technology is great work, but I can’t help but question how it feels to see the state of bitcoin in this current landscape.I’d like to assume that Satoshi finds more delight in the overall growth of the space than Bitcoin.
Start Your Futures Trading Journey on KuCoin.
