The cryptocurrency world is at an inflection point. The Merge is here. When complete, Ethereum’s consensus mechanism will have changed from a modified version of Bitcoin’s Proof of Work to its own Proof of Stake. Since its inception, Ethereum was never meant to be like Bitcoin. Ethereum’s focus has always been on interoperability, composability, and scalability. It was always meant to scale to a PoS chain when the moment presented itself.
By empowering network stakeowners to validate the network rather than miners, Proof of Stake reduces energy consumption, increases throughput, and sets the stage for future scalability solutions. It is a technological marvel and will certainly play a significant role in the future of Web3. However, by relying on token holders for decentralization and security, PoS opens the door to vulnerabilities impossible under PoW. As discussed in Core Blockchain Origins, entities with outsized token ownership like centralized custodians and staking services will always threaten the security and decentralization of PoS networks. These threats are poised to grow over time as new participants who are disinterested in self-custody or governance gladly outsource such duties to third parties.
The Layer One Race
With Web3 predicated on decentralization-enabled self-sovereignty, centralized control of its underlying infrastructure is a grave threat. However, the most concerning immediate threat to Web3 is the cultural trend unintentionally inspired by the Merge’s popularity. When Ethereum established its roadmap, it inadvertently set the stage for a layer one (L1) blockchain race. With the Merge being so highly anticipated, Ethereum’s cultural north star has always been scalability. With that exciting target, L1 success became synonymous with speed and seamlessness, the new measuring grounds for fresh L1s looking to displace Ethereum. The growth-at-all-costs approach has enabled alternative L1s to gain a swift head start on scalability relative to Ethereum. However, as in Aesop’s fable The Hare and the Tortoise, the race is not always won by the swift. And just as the hare took an ill-advised nap after getting out to a quick head start, hyper-scalable blockchains slept on the importance of security and decentralization. Their naps come in the form of outages, security-breaches, and decentralization theater around highly concentrated token distributions.
Nevertheless, advances in hyper-scalable blockchains are exciting. Despite serious flaws, they excel at introducing users to Web3 and providing optionality for the crypto ecosystem. However, with seemingly all popular chains trending away from sound governance as a priority in favor of “good enough”, the crypto world is beginning to run low on options.
Bucking the Trend
The gap between Bitcoin and Ethereum has never been wider. The stage is set for a blockchain that will buck the trend by prioritizing security and decentralization, all with a user-first approach. That blockchain is Core. But Core cannot skip any steps. No core blockchain element can be sacrificed for the sake of short-term, zero-sum gratification. The solution to the blockchain trilemma is rounded edges, not emphasis on one of its points.
Refusing to skip steps is a necessity, but it does not mean everything must be built from scratch. No new consensus mechanism could match Bitcoin’s security and decentralization, so Core directly leverages its PoW system. Similarly, no new blockchain could efficiently re-create Ethereum’s stack of “money-legos,” so Core embraces EVM compatibility. By leveraging existing knowledge, technology, and infrastructure, Core speed-runs the development process. However, Core isn’t just building on the systems of old. By combining different elements of various chains, Core turns contradictions into complements. Satoshi Plus consensus integrates PoS and PoW to capitalize on the former’s scalability while maintaining the latter’s security and decentralization. With decentralized PoW and scalable PoS, Core offers the well-roundedness that Web3 needs.
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