Senator Pat Toomey (R-PA) asks Peter Van Valkenburgh about the scalability of Bitcoin and the underlying Blockchain technology and whether or not Bitcoin can exceed 5 transactions per second.
Peter Van Valkenburgh speaks about batching, smart contracts, application layers being built on top of the Bitcoin protocol, specifically mentioning Lightning Network payment channels for microtransactions. Sen. Toomey follows up asking how centralized mining, or a mining oligopoly on Bitcoin, may affect the Bitcoin network.
Peter Van Valkenburgh responds by posing the questions that when mining power is accumulated, what harm may be inflicted on the Bitcoin network?
You can’t do much. You can’t change the number of Bitcoin that are in circulation… you wouldn’t be able to make that block and have it be accepted by the network. You can’t reallocate or move other people’s funds on the blockchain. The worst you can do is, during the time when you leveraged massive costly resources, you can slow down the network and block transactions. It’s a denial of service attack, something that all internet systems are vulnerable to… even the fintech that Dr. Roubini talks about. Peter Van Valkenburgh
Pat Toomey is a Republican senator in the state of Pennsylvania and worked in the financial sector before entering politics. Peter Van Valkenburgh is the Research Director at Coin Center and JD from NYU, having studied intellectual property law.