Why Cardano’s Hoskinson Called Proof-of-Work a Road to Nowhere

Cardano’s inventor and IOG CEO Charles Hoskinson commented on Bitcoin’s hashrate dropped after a blackout struck some small counties in the province of Xinjiang.

Major Bitcoin mining pools saw their hashrate crashed. As informed by Primitive Crypto founder partner Dovey Wan, F2Pool, AntPool, Poolin registered a drop of up to 33%.

these are pools affected the most by the incident. the accurate numbers at the global hash rate level will take days to refect

charts made by @officialpoolin stats and h/t from local news outlet 吴说区块链 pic.twitter.com/0Wgsng3OBN

— Dovey “Rug The Fiat” Wan?? (@DoveyWan) April 16, 2021

Although the hashrate has been quickly climbing back up in the past day, the incident has been used to highlight what some consider a “Bitcoin problem”. Hoskinson shared an article on the incident via his Twitter handle and said the following:

Proof of stake doesn’t suffer from this problem wake up people! Nakamoto consensus is a road to nowhere.

In 2020, Cardano transitioned from a Proof-of-Work consensus algorithm to a Proof-of-Stake. This event initiated Cardano’s Shelley era. Hoskinson said in a previous interview that the former has more advantages than the latter.

Adding that currently there is a “great movement of value” from PoW to PoS like Ethereum 2.0, Polkadot, Cardano, and others, IOG’s CEO predicted a “distribution of wealth” to these blockchains in 2021. Hoskinson added:

The issue is it can never get better by design. The more successful bitcoin gets, the higher the price goes; the higher the price goes, the more competition for bitcoin; and thus, the more energy is expended to mine.

However, Castle Island Ventures general partner Nic Carter said a daily 40% down on Bitcoin’s hashrate should be a percentage to be handle carefully. Carter added:

Whole decline not statistically significant (HR variance extremely high). Need to look at longer timeframes (ideally 7d) to determine effect on hashrate.

He said the event could shed new light on Xinjiang percentage of Bitcoin’s hashrate during the dry season. Data on this subject is over a year old, as Carter said, speculating on the possibility that a Bitcoin’s HR in China could be migrating abroad:

Lastly – to those ppl who think a China ban on mining would kill bitcoin – this is what it would look like – blocks would be slow for a while and that’s it. Banning mining in 1 place doesn’t make bitcoin any less secure – no “required” threshold for hashrate.

Cardano (ADA) could go to $2

At the time of writing, ADA is trading at $1,25 with a 10% pullback in the daily chart. In the weekly and monthly chart, ADA is showing a 2.4% and 0.9% profit.

The CEO of Ajoobz “Elja” said ADA has managed to set “strong supports” at $1,20 and $1,22 after yesterday’s crash in the market. Elja expects a “relief bounce” from the current levels and if ADA can keep the bullish momentum, the cryptocurrency could target $2,50.