Forex in this article
• Chris Larsen was sometimes the fifth richest man in the world
• Ripple founder Larsen is now interested in a greener Bitcoin
• Larsen is harshly criticized by Bitcoin entrepreneurs
CoinDesk recently reported on Chris Larsen’s latest $5 million investment in an ad campaign that advocates for a greener way to create Bitcoin. The announcement of this donation aroused strong criticism – but why? A look at his CV is essential for this.
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Larsen: Founder of Ripple of dubious reputation
Silicon Valley veteran Larsen was considered the richest man in the crypto world for several years. According to data from Forbes, during Ripple coin XRP’s huge surge in early 2018, his wealth peaked at $59 billion – briefly making the crypto investor the fifth richest man in the world. But the significant drop in the price of Ripple coins, of which Larsen owns a large part, has melted his fortune. Forbes currently estimates his net worth at around $2.5 billion.
Larsen has founded several fintech companies and invested in many startups. But he is best known for founding Ripple Labs Inc. in 2012. In addition to the digital coin XRP, Ripple’s goal was to become a widely recognized peer-to-peer digital payment network based on blockchain technology. While XRP is still the eighth largest cryptocurrency in the world according to data from “CoinMarketCap” with a total volume of US$37.3 billion (as of April 06, 2022), the peer-to-peer payment network has had much less success. In October 2021, Larsen also came into the crosshairs of the United States Securities and Exchange Commission, as Ripple allegedly sold unregistered securities in the form of XRP tokens and raised US$1.3 billion in the process.
Larsen backs a greener bitcoin ad campaign
According to CoinDesk, Larsen is supporting an advertising campaign with the motto “Change the code, not the climate” in cooperation with Greenpeace and other environmental organizations. The goal of the project, to which Larsen donated $5 million, is to raise awareness in the Bitcoin community of the enormous amount of energy required to generate the world’s largest cryptocurrency. The concrete solution proposed by Larsen and Co. is that bitcoins are no longer generated using proof-of-work mining, which is considered safe but very energy-intensive. Instead, the much more environmentally friendly proof-of-stake process should be used for Bitcoin. However, this idea is not universally welcomed.
Majority of Bitcoin Investors Oppose Switch to Proof-of-Stake Methods
On the contrary: many consider such a major change to be “extremely risky, totally unachievable, perhaps even unnecessary”, according to David Morris in a “CoinDesk” article. Such a fundamental change probably cannot be achieved via a conventional “hard fork” (a split of the blockchain due to disagreements between programmers), as was the case with bitcoin’s split in August 2017 between classic bitcoin and bitcoin cash. following the controversial upgrade was the case with the expansion of the SegWit protocol. On the contrary, a switch to the proof-of-stake variant would likely lead to much more violent conflicts. The proof-of-stake infrastructure runs on a completely different security architecture, so adapting this method would involve a complex move from old wallets to a brand new network.
Such a program change seems extremely unlikely at the moment. The well-known bitcoin enthusiast with the pseudonym Gigi wrote on Twitter: “Proof of Stake is not only more insecure, but completely useless and insecure. Without PoW [Proof-of-Work, Anmerk. d. Red.]every system becomes political, conflict resolution is moved to a quorum.” Nor is Larsen likely to receive encouragement from the many Bitcoin miners who invest millions of dollars in highly specialized chips called ASICs ( In short, convincing the entire Bitcoin community to switch to proof-of-work is likely to be a “nearly impossible task,” according to David Morris.
Industry experts are skeptical
The proposal is particularly unpopular because Larsen is a hugely controversial person in the cryptoverse. Many bitcoin fans accuse him of directing his entire crypto career to harm bitcoin – so they don’t trust the seemingly benevolent intentions regarding his greener bitcoin initiative. Some critics specifically complain that Larsen intentionally wants to cause a “hard fork” in order to divide the Bitcoin community and thus weaken it – especially since the world’s largest reserve currency can score with huge network effects thanks to its international acceptance and security. Matt Walsh, director of Bitcoin firm Castle Island Ventures, sneered on Twitter: “America…the only country in the world where you can offload billions of unregistered securities used for retail investors like Fidget Spinner [Handkreisel, vgl. Logo von Ripple, Anmerk. d. Red.] watch, then use the product to educate real entrepreneurs about their bitcoin business” – an obvious reference to Larsen.
America…the only country in the world where you can make billions by throwing unregistered securities that look like fidget spinners at retail investors, then use the proceeds to teach real entrepreneurs lessons about their bitcoin businesses
-Matt Walsh (@MattWalshInBos) March 29, 2022
But Larsen defended himself in a “Bloomberg” interview against vociferous criticism from the Bitcoin community: “If I was worried about Bitcoin as a competitor, that would probably be the best thing I could do to keep it going. .. It’s just an unsustainable way.” However, it remains to be seen whether the Larsens-backed campaign will have the desired effect.
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