Northwestern: Bitcoin Requires Centralization to Move Up
A recent study by Northwestern University indicates some type of collaboration or agreement made between the Bitcoin ecosystem and traditional central banks. According to this study, Bitcoin’s low transaction rate directly hindering the willingness of others to adopt its current POW system.
Northwestern's Sarit Markovich, a professor of strategy associated with the Kellogg Management division stated that the main difference between networks such as central banks and bitcoin is the fact that one is decentralized and the other isn’t. In order for bitcoin to scale to some degree, a compromise must be settled issues a certain degree of centralization into the cryptocurrency’s platform.
This pattern has already been noted among other digital currencies such as EOS which relies on votes to validate blocks rather than countless devices processing data in order to mine.
Partnered with bIoXroute Labs, the University has begun developing technologies that plan to offer a solution to the issue known as scalability bottleneck. This term refers to the issue often caused by the mass amount of computer processing dedicated to each block along the greater chain.
Although research continues, the results thus far do not suggest encouragement as the results propose a push towards even more centralization of the digital currency ecosystem. Essentially, this approach would go against the original appeal of cryptocurrency that drew in popularity for nine years.
Despite numerous issues associated with proof of stake structures, there is evidence to show that this solution could promote a network’s decentralization whilst aiding the speed at which blocks are processed. Together with zero knowledge proofs, a digital currency could eventually include anonymity as well, facilitating speedy private online transactions.
Although not much has been revealed about the development of Northwestern’s blockchain solution, speculations suggest it could lead to centralizing a digital currency despite the disapproval of crypto enthusiasts worldwide.