Zcash founder Zuko Wilcox encouraged the community to abandon the Proof-of-Work (PoW) consensus method and switch to Proof-of-Stake (PoS).
Since its inception, the Zcash blockchain has operated on a Proof of Work (PoW) consensus. Initially, the ZEC cryptocurrency could be mined on graphics processing units (GPUs). In 2018, Bitmain launched specialized ASIC miners for Zcash mining, after which GPU mining became obsolete. Wilcox now sees more benefits in Proof of Stake (PoS) consensus.
Wilcox stated that the Zcash community must make a choice about whether or not it is ready to make such changes, and laid out a number of reasons why the transition should take place. First of all, Zcash’s move to PoS will ease the selling pressure on ZEC. According to Wilcox, today, Zcash miners receive $ 300,000 worth of coins every day, and almost all of them are forced to sell to recoup their electricity and hardware costs. Within one year, this amount can reach $ 100 million. With a PoS consensus, miners, more precisely, stakers mining ZEC, will be able to keep the earned coins longer, becoming long-term investors.
The founder of Zcash believes that ZEC mining should become more energy efficient. Considering that mining of cryptocurrencies based on PoW consensus leaves a large carbon footprint, many will refuse to accept such cryptocurrencies when more energy efficient alternatives exist.
Wilcox disagrees that cryptocurrency mining is fueling global warming and damaging the environment, but he believes it is important to take public opinion into account for ZEC to become ubiquitous. Moving to PoS will be a win-win that will ensure the economic and social freedom of people, Wilcox said.
In addition, moving to Proof-of-Stake will improve network security and performance at a lower cost. He explained that when mining cryptocurrencies using the Proof-of-Work consensus, the community overpays for the security of the network, since it cannot punish the violating miners. Therefore, in order to keep their loyalty, it promises big rewards for miners. By moving to PoS, users can be confident that their transaction will not be “dropped”. In addition, by participating in staking, users would have the right to control the protocol.
“While miners prefer PoW, I believe PoS will make ZEC more valuable to people. The benefits of this consensus method are enormous, and they far outweigh the disadvantages and risks of PoW, ”said Wilcox.
This spring, Ripple co-founder Chris Larsen recommended that Bitcoin developers consider switching from Proof of Work to Proof of Stake consensus algorithm due to high energy costs.
