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Investing.com – Microstrategy Chairman Michael Saylor, who has 130,000 on his company’s balance sheet, believes that is just as threatened as .
Ether developers had been working since 2015 to move from energy-intensive proof-of-work (PoW) to more efficient proof-of-stake (PoS). This milestone became reality in September, which, in Saylor’s view, puts the blockchain at risk of collapsing.
In PoS, it is a must that the validators needed to verify transactions have enough ETH. It was precisely this point that Matthew R. Kratter identified as the Achilles heel of the whole thing in his latest video, earning him a round of applause from Michael Saylor.
Kratter explains that if, for whatever reason, it was taken down on a large scale and was no longer available for consensus PoS, then the entire network would collapse:
“The lower the price of Ethereum goes, the more people will decide to withdraw their coins. This in turn undermines the security of Ethereum and can lead to a death spiral.
Regulators need to consider whether proof-of-stake protocols like Ethereum and risk experiencing catastrophic implosions like Terra Luna.”
Saylor reinforces Kratter’s point and adds that PoS have a fragile design and are therefore inherently risky.
By Marco Oehrl