When Kadena made the decision to make its blockchain public, CEO Stuart Popejoy admitted that there was an adjustment period where they had to embrace cryptocurrency. However, he emphasized the importance of the people participating in their ecosystem, stating that they are the network and that it is a grassroots endeavor rather than a purely enterprise-focused one.
The debate surrounding the merits of private blockchains continues, but Kadena made the transition from a private JPMorgan blockchain to a public spinoff in 2020, with Popejoy, a former JPMorgan executive, leading the way. Popejoy explained that while there was some innovation in private blockchains, they recognized the need for something that could cater to business-scale needs, which led them to develop their version of a public blockchain.
One of the key features of Kadena’s blockchain is its horizontal scaling, which prioritizes safe smart contracts and scalability as a risk management measure. Popejoy compared this to Bitcoin, highlighting that the issue with proof of work is not the energy usage itself, but rather its inefficiency in improving the system. He emphasized that Bitcoin remains a slow system despite the energy consumption.
Similar to Bitcoin, Kadena utilizes a proof-of-work consensus mechanism, but they have implemented horizontal scaling to address its limitations. Popejoy confidently stated that Kadena has the capability to settle the entire U.S. stock market on a daily basis.
While some may question the speed of Kadena’s blockchain, Popejoy noted that clawbacks can be programmed into smart contracts and security tokens to address any potential issues. Currently, Kadena operates with 20 chains running in parallel, but adding more chains would not significantly increase energy consumption.
Popejoy also addressed the issue of money distribution in proof-of-work systems. He stated that proof of stake generates money and uses ownership of money to determine who runs the system, whereas proof of work provides a fairer distribution of coins to individuals.
In conclusion, Kadena’s transition to a public blockchain reflects their belief in the need for a blockchain that can cater to business-scale needs. Their focus on horizontal scaling, safe smart contracts, and addressing the inefficiencies of proof of work demonstrate their commitment to creating a more efficient and effective blockchain system.