Bitcoin's environmentally-destructive validation mechanism may hasten its end. Newer cryptocurrencies have blockchain technology that enables technology like NFTs and DeFi while also being more energy efficient.
Bitcoin is currently the world’s largest cryptocurrency. The crypto currently has a price of $46,340 and a market cap of $875,674,187,883. It is the most expensive cryptocurrency out there and has the highest market cap of all cryptocurrencies.
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But Bitcoin may not be able to hold on to the throne for much longer. A senior expert has stated that cryptocurrency may not even exist in the future as well.
“Bitcoin itself may not last that much longer,” Eswar Prasad, senior professor of international trade policy at Cornell University told CNBC.
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“Bitcoin’s use of the blockchain technology is not very efficient,” said Prasad, who is the author of The Future of Money: How the Digital Revolution is Transforming Currencies and Finance.
Prasad’s main criticism of Bitcoin stems from the token’s use of a “validation mechanism for transactions that is environmentally destructive” and the fact that it “doesn’t scale up very well.”
Bitcoin has a volatile history, hitting its record high earlier in the year, and the token is down by over 20 percent over the past 30 days. At the same time, it is still up by over 47 percent year-to-date.
“Given that Bitcoin is not serving well as a medium of exchange, I don’t think it’s going to have any fundamental value other than whatever investor’s faith leads it to have,” Prasad said.
But Prasad added that Bitcoin’s initial development and popularity have paved the way for other cryptocurrencies to develop newer methods of transactional validation while improving the efficiency of the underlying blockchain technology.
“Much as you might not like Bitcoin, it has really set off a revolution that ultimately might benefit all of us either directly or indirectly,” Prasad said. Like, the ability of newer cryptocurrencies like Solana to enable DeFi platforms and websites to thrive, as well as enable the easy transfer and exchange of NFTs that are rising in popularity meteorically.
Currently, Bitcoin is not the only large cryptocurrency that has seen a slump in value in recent weeks. Prices of major altcoins like Ethereum, Solana, Cardano, Avalanche, Polkadot and others have slid as well.
Also watch: https://www.youtube.com/watch?v=_VzaNQNDhKQ
(Edited by : Shoma Bhattacharjee)