Bits.media founder Ivan Tikhonov: “Ethereum needs to switch to Proof-of-Stake”

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The creator of Bits.media spoke on the RBC channel, talking about Ethereum’s transition to Proof-of-Stake and what objections miners have about this.

Ethereum developers for about five yearsare intensively working on the transition of the Ethereum network from the Proof-of-Work (PoW) consensus algorithm to Proof-of-Stake (PoS). However, recently, leading Ethereum developer Tim Beiko announced the expected date for the merger of the test network with Ethereum 2.0 and the transition to a different consensus mechanism: September 19, 2022. It is expected that after Ethereum fully transitions to PoS, the network’s electricity consumption will be reduced by 99.95%. Thanks to greater decentralization, network security and capacity will increase. In addition, the cost of transactions in Ethereum will gradually decrease.

Founder of Bits.media Ivan Tikhonov told viewers that not all participants in the cryptocurrency community are happy with the transition. Miners accustomed to the PoW consensus method will have to switch to alternative networks, such as Ethereum Classic. Given that they do not have the same market capitalization as Ethereum, it is riskier for miners.

“People have questions about what aftertransition to Proof-of-Stake block validation will be done by people we don’t know. It will be enough to buy a large number of ethers and install more nodes. It is unknown who owns the validators: there are now more than 400 000 of them. One person can hold 100 000 nodes. Whoever has more money will “steer” online, and this does not suit everyone,” says Ivan Tikhonov.

Ivan considers it quite reasonable that the teamEthereum is taking too long to update. According to him, the cost of any mistake can be too high - if something goes wrong, people will lose the money, time and resources invested. 

Miners must be aware that even whencreation of Ethereum, the developers initially talked about switching to PoS. Previously, launching a project on a proven PoW algorithm was quite safe, but such a large-scale project as Ethereum would not work on it for a long time, Ivan believes.

In April, creative director of Bits.media Alexandra Demidova spoke about the main stages of Ethereum development, saying that the transition to PoS is just the beginning of a new era for Ethereum.