In a recent post on Twitter, Vitalik Buterin, the co-founder of Ethereum, noted that ETH offers many advantages and appealed to use the cryptocurrency more as a means of payment.
According to Buterin, this has the advantage that when using ETH as a means of payment, all other Altcoins running on the Ethereum Blockchain can be used at the same time without any further effort. In response to this request, many responded that they would be happy to do so, but that Ethereum has too high transaction costs due to lack of scalability.
“More people should support ethereum for payments. The nice thing about supporting ethereum is that you not only accept ETH, but also get support for MKR, UNI, WBTC and any Stablecoin for free. And there are already about three working layer 2 scaling solutions in Mainnet.”
Vitalik Buterin made these comments in response to a contribution from Spencer Noon, CEO of DTC Capital, who pointed out that Square is making a bad business decision because they failed to support Ethereum for payments in addition to Bitcoin.
“No one will ever be able to convince me that @Square’s refusal to support Ethereum (in addition to Bitcoin) is not stupid. It is the most headstrong crypto strategy we have ever seen from a large company, and that means something…”
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The Cash App from Square
Jack Dorsey of Twitter, the CEO and chairman of San Francisco-based Square, co-founded the payment company to make payments convenient, fast, comprehensive and cost-effective. Square’s largest product, the Cash App, enables people to send or receive money directly on a peer-to-peer basis with no hidden fees, and offers a free Visa card, the Cash Card. Cash App is also a Bitcoin exchange that allows users to buy, sell, deposit, store and withdraw Bitcoin.
In August 2020, Square reported that its Cash App revenues from Bitcoin increased 600% to $875 million in the second quarter, bringing the company’s profits up 711% to $17 million. The Company attributed Bitcoin revenues and gross profit to an increase in Bitcoin sales and growth in customer demand.
Currently, the Cash App is recognized as the fastest growing digital wallet in the U.S., accounting for up to 72% of Square’s total revenue, with an estimated 30 million active users per month.
Ethereum or Bitcoin: Which is the better payment method?
Ethereum is widely used as a payment method and is mainly supported by small and medium-sized enterprises and the Enterprise Ethereum Alliance (EEA). The EEA brings together organizations from around the world to develop Ethereum’s blockchain ecosystem.
Unlike Bitcoin, which is primarily used to send and receive payments, ETH is also a utility token that supports the development of distributed applications on the ETH Blockchain.
Both Bitcoin and Ethereum are based on the proof-of-work consensus algorithm, which makes transactions slower and more expensive as network activity increases.
However, Bitcoin has developed several solutions to overcome scalability limitations while Ethereum still has to introduce its new proof-of-work network (ETH 2.0), which not only solves scalability issues but also aims to increase investor confidence in the value of ETH.
The latest development in ETH 2.0 is the launch of the Spadina test network on September 29th, to give the stakeholders a final run before the official launch, which is expected to take place before November 30th.
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First published in CRYPTO MONDAY, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.
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