The former JPMorgan executive explained how he came to love cryptocurrency and why the Kadena blockchain will not abandon proof of work.
“There was an adjustment period where we had to learn to love crypto,” Kadena founder and CEO Stuart Popejoy said of going public with its blockchain. “The people who participate in your ecosystem really are your network,” he added, “and that’s obviously not a very enterprise-y thing, that’s very grassroots.”
Although the benefits of private blockchains are debatable, Kadena transitioned from a private JPMorgan blockchain in 2016 to a public spinoff in 2020, bringing Popejoy, a former JPMorgan executive, with it.
“For a brief moment, there was some innovation in private blockchain, and that kind of represents us.” “There was this idea that we needed something […] that could serve business-scale needs, and that’s how we arrived at our version of a public blockchain,” Popejoy explained in an interview with Cointelegraph, adding, “This stuff will never take off if it can’t handle industrial loads.”
Horizontal scaling is a feature of Kadena. When the system is backed up, “we focused on safe smart contracts and scalability as a safety thing, in the sense of risk management, like if you have to wait a day for your Bitcoin transaction to go through,” Popejoy said.
Popejoy frequently mentioned Bitcoin. “We were very excited by the fundamental design of Bitcoin,” he said.
“We believe that the real issue with proof of work is not that it consumes energy, but that it consumes energy inefficiently,” he continued. “Bitcoin: all this energy is being expended that isn’t improving the system. It’s the same sluggish system that existed 15 years ago.”
Kadena, like Bitcoin, employs a proof-of-work consensus mechanism, “but it scales it so that we actually have horizontal scaling for proof of work,” according to Popejoy. “We like to say, and it’s true because I know how this stuff works, that we could settle the entire US stock market on Kadena today, daily.”
Although not everyone sees the speed as a benefit, Popejoy noted that clawbacks can be programmed into smart contracts and security tokens.
Kadena currently has 20 parallel chains running, but more chains would consume the same amount of energy.
The real issue with proof of work is money distribution. “Proof of stake generates money, and ownership of money determines who runs the system,” Popejoy explained. Proof of work “is the most equitable method of getting coins into people’s hands.”