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In a recent interview, Ripple CTO David Schwartz talked about the advantages of the XRP Ledger consensus mechanism over Bitcoin’s Proof-of-Work (PoW) consensus mechanism.
Ripple CTO’s comments on Bitcoin and XRP came during a Zoom call with TechRadar Pro a few days ago.
The miners’ participation in Bitcoin’s PoW consensus process means you have an intermediary and decentralized payment network that some believe, Schwartz says:
Cryptocurrencies must be a one-way market; users want a store of value and a medium of exchange. But what Bitcoin has done is turn it into a two-way market …
Miners have struggled for high transaction fees, as it is their revenue. The reality is that you have a bunch of other stakeholders trying to charge the highest fees they can get, and that’s not much different from how bank payments work.
After understanding PoW issues in 2011, Schwartz and former colleague Jed McCaleb decided to try something different that could improve speed and really move towards decentralization:
What we are starting to think is that PoW is not the great thing about Bitcoin. The reality is that all transaction data and transaction rules are public and have no central operator. ..
What we did was trust completely – minimizing the system, eliminating the engine of cyberattacks …
The way we design XRPL is a consensus algorithm that only places transactions in order. There are no crypto rewards, so the process is collaborative, as opposed to competition.
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