As a researcher with experience in the blockchain industry, I find Charles Hoskinson’s reaction to the recent Cardano security sustainability poll intriguing. The poll, initiated by Rick McCracken Digi, asked the ADA community which option they preferred for funding Cardano’s future security – 2% inflation of ADA rewards or 20% of the inflation-generated revenue from staking other or partner chains.
As a Cardano investor, I’ve been following the lively debate on the platform regarding the security sustainability of our beloved network. In response to a recent poll on this topic, Charles Hoskinson, the founder of Cardano, shared some insightful thoughts that have added fuel to the discussion. The poll results have brought up important questions about the economic model that supports the security of blockchain networks, including ours.
Rick McCracken Digi, one of the Cardano Stake Pool Operators (SPOs), initiated a survey on platform X among the ADA community. The poll focuses on the preferred means for ensuring the long-term security of Cardano. Participants were given two primary options to consider.
Option one: Similar to Ethereum, Dogecoin, and Solana, the initial selection offered a 2% inflation for ADA rewards.
Approximately 75% of Bitcoin‘s total mining earnings stem from transaction fees rather than block inflation. With millions of transactions being handled in Cardano, these facilitate the compensation for block producers.
— Charles Hoskinson (@IOHK_Charles) June 3, 2024
Approximately one fifth (20%) of the respondents selected the initial choice, whereas around thirty-five and a half percent (35.3%) opted for the second alternative. Notably, more than four out of ten respondents (44.8%) remained undecided and picked the “display results” option instead.
As an analyst, I’d like to highlight an intriguing fact brought up by Hoskinson in response to the recent poll. Approximately 75% of the Bitcoin network’s revenue comes from transaction fees instead of block inflation when generating new blocks.
Based on the founder’s response, it seems that Cardano may follow a comparable path. Given the anticipated high volume of transactions on Cardano, approximately millions, it is implied that these transactions will finance the block producers. In turn, this financial support ensures the network’s security and long-term viability.
As a crypto industry analyst, I’ve observed a notable trend towards adopting transaction fee-based revenue models among various players in the market. This shift is driven by the belief that such models offer greater sustainability over the long term compared to relying solely on block rewards.
McCracken, a Cardano community member who started the poll, concurred with Hoskinson’s perspective. However, he emphasized the importance of addressing two key aspects for the platform’s sustainability: improving throughput and accommodating a sufficient number of users.
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2024-06-06 12:54