Blockchain
Expert crypto enthusiasts – most of them anyway – generally agree that the Bitcoin network, thanks to its highly competitive and tamper-resistant blockchain design, is the most secure decentralized blockchain network in the world.
And for many, the competition isn’t even close. According to its strongest loyalists, dubbed bitcoin “maximalists,” all other protocols are nothing more than inferior knock-offs that will inevitably fall into irrelevance given enough time.
While Morgan Creek Capital founder Mark Yusko doesn’t consider himself a maxi, he does claim that the closest competitor is a distant second in the rankings at best.
In an interview with Mike Ippolito on Blockworks’ On the Margin podcast, Yusko asks, “What’s the safest, most secure computer network the world has ever known?”
“The Bitcoin Blockchain. And it’s not close, is it?
Ippolito pushes back and asks, “Don’t you think Ethereum is close in terms of the settlement guarantees?”
“I don’t think it’s close,” Yusko replies.
It’s like comparing prestigious business schools, says Yusko. The top schools are recognized and approved by all: “Harvard,” then gesturing downwards, “Stanford — and then everyone else who thinks they’re number three.”
“I will argue, bitcoin is number one. Ethereum is a pretty big step backwards.”
“I’m still not convinced — and I’m willing to be convinced — that proof-of-stake is as secure as proof-of-work.”
“I may just not understand the technology well enough,” he admits, but “proof of work is at least an order of magnitude more secure than proof of stake.”
Different step-by-step plans
Ippolito argues that the two blockchains serve different purposes. “I like them both. I just don’t see them as competition. I think they are very different things.”
“To really, really love bitcoin and have it be the vast majority, like the only asset you have,” says Ippolito, “you have to have a pretty vague idea of what’s going to happen in the future.”
Ippolito admits, “some sort of reckoning is probably coming and that’s why I like bitcoin.”
“That said, there’s not much to do on that network.”
With Ethereum, says Ippolito, so many applications are being built for different purposes, including borrowing and lending for returns, money market funds, and so on. “That’s more intellectually interesting to me and takes a lot of my mind.”
What makes the Bitcoin network such a great store of retail value also makes it very difficult to build applications on top of it in the same way Ethereum does, says Ippolito.
“They followed two different roadmaps,” he argues.
One chain to rule them all
“Look, we are tribal at our core,” says Yusko.
“I hear the maxis booming, and I just ignore the nonsense of it, the poisonous part of it.”
“If DeFi can be successfully built on the bitcoin blockchain,” he says, with features built on top that resemble traditional financial layers like Fedwire, ACH, and Visa, “then we can have one chain to control all chains.”
“But I’m open,” says Yusko, “I’m not going to ignore the fact – a lot of interesting things are being built in Ethereum.”