Brad Garlinghouse has questioned how much influence Chinese miners have over Bitcoin’s network.
Speaking at the Stifel Financial 2018 Cross Sector Insight Conference in Boston, the CEO of Ripple (the company), Brad Garlinghouse, has questioned Chinese influence over Bitcoin’s decentralised network. His comments, reported by The Street, were part of a wide-ranging interview that seemed to cover a lot of ground.
Garlinghouse’s initial comments on BTC involved telling the crowd that current headline crypto was “not the panacea we thought it would be…”, before repeating the oft-repeated Ripple (the company) line that Ripple (XRP – the cryptocurrency) was “the best digital asset for settlement.”
“Bitcoin today,” he said, “takes 45 minutes to settle a transaction. Whereas XRP could take 4 seconds to settle.”
His most interesting thoughts on BTC, however, were reserved for the role China has in the upkeep of its blockchain.
“I’ll tell you another story that is underreported, but worth paying attention to,” he said. ” Bitcoin is really controlled by China. There are four miners in China that control over 50% of Bitcoin.”
His comments are interesting, considering the long running debate regarding just how much influence Ripple (the company) can exert on Ripple (the cryptocurrency) due to the massive reserves of it the company holds in its coffers. Many argue that these reserves mean that XRP is more akin to a stock or security than a method of payment, despite (the company) Ripple’s repeated assertion that it exerts no control over it.
His conclusion on Bitcoin, however, was that controlling mining doesn’t necessarily mean that China’s authorities are looking to exert control over it.
His reason for this references a little bit of game theory that underpins crypto philosophy, that the very act of trying to control a decentralised network would reduce its usefulness to the point of making it worthless.
“How do we know that China won’t intervene?”, he pondered. His conclusion, was simple. “How many countries want to use a Chinese-controlled currency? It’s just not going to happen.”
Indeed, Garlinghouse even admitted that he own Bitcoin himself. While he acknowledged that he’s “long crypto”, his only advice to potential investors was that he’d “advise folks to only invest in crypto only what you’re willing to lose. It’s early to tell how it is going to play out.”
“We’re at mile 1 in a 26 mile marathon”, was his conclusion.
“A number of prominent people, even Steve Wozniak,” he said, “[see] a world where Bitcoin is the primary currency. I think that’s absurd. I don’t think that any major economy will allow that to happen. By the way, it doesn’t make sense.”