NSA whistleblower and privacy advocate Edward Snowden said that he believes Bitcoin will eventually be supplanted by another cryptocurrency that does not utilize a public ledger.
Snowden, who made this statement earlier this month at a Blockstack event in Berlin, said that he believes Bitcoin’s chief drawback does not have to do with its ability to scale — as many critics allege — but rather its lack of privacy.
“Everybody is focused on the transaction rate limitations of bitcoin being its central flaw, and that is a major one, but I would argue that the much larger structural flaw, the long-lasting flaw, is its public ledger,” he said via webcam. “That is simply incompatible with having an enduring mechanism for trade, because you cannot have a lifelong history of everyone’s purchases, all of their interactions be available to everyone and have that work out well at scale.”
“I don’t think Bitcoin will last forever,” added Snowden, who hinted that he had used Bitcoin in 2013 to conceal his identity while preparing to release classified National Security Agency (NSA) documents documenting privacy abuses — including some that showed the NSA was actively spying on Bitcoin users.
“Bitcoin does important work and I do think it will have enduring value for a long time, but particularly when we look at the core development team and their rate of improvement to the protocol, they simply need to better or they will not be able to compete,” he continued.
Snowden said that he is most interested in privacy-centric cryptocurrencies like Zcash, which obfuscate blockchain data to allow users to verify the integrity of transactions while keeping them private from would-be snoopers.
“When we talk about which cryptocurrencies are interesting to me, I’ve said it before and I’ll say it again, Zcash for me is the most interesting right now, because the privacy properties of it are truly unique, but we see more and more projects that are trying to emulate this and I think this is a positive thing.”
Snowden added that he had tested Monero and a variety of other privacy-centric coins, though in the past he has said that he feels more comfortable with Zcash since it has been developed by academic cryptographers.
“Everybody is focused on the transaction rate limitations of bitcoin being its central flaw, and that is a major one, but I would argue that the much larger structural flaw, the long-lasting flaw, is its public ledger,” he said via webcam. “That is simply incompatible with having an enduring mechanism for trade, because you cannot have a lifelong history of everyone’s purchases, all of their interactions be available to everyone and have that work out well at scale.”
“When we talk about which cryptocurrencies are interesting to me, I’ve said it before and I’ll say it again, Zcash for me is the most interesting right now, because the privacy properties of it are truly unique, but we see more and more projects that are trying to emulate this and I think this is a positive thing.”
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