Categories: Workspace

Marc Andreessen Talks Up Bitcoin’s Bright Future

During a panel session at the Open Compute Summit on 29 January in San Jose, California, celebrated Internet browser pioneer turned venture capitalist Marc Andreessen explained why he’s bullish on the Bitcoin cryptocurrency, as well as the hardware that will need to support it.

New Bitcoins are created by way of a compute-intensive process known as mining. “Bitcoin mining is the heart of Bitcoin, which is all the computation that is done to maintain the trust network,” Andreessen said. “The press reports on mining as a waste of time, but in reality it’s all the proof of work computation that makes a distributed trust network work.”

Mining improvements

Andreessen said that, in the long run, a distributed system such as Bitcoin is certainly an alternative if not an outright replacement to centralised entities like banks and stock exchanges.

“There is a very big thing going on now with mining that we’re in the very early stages of,” Andreessen said.

Efforts to improve Bitcoin mining are now under way, working under the basic assumption that the cheaper you can mine Bitcoins, the more money you can make. Andreessen said that at his venture capital firm, Andreessen Horowitz, he is seeing business pitches for Bitcoin-optimised data centres.

The Bitcoin phenomenon is resulting in chip design innovation as well. “There is a big opportunity to apply custom silicon to mining,” Andreessen said. “We’re seeing a new wave of chip design around it, which is not something I would have predicted a year ago.”

While mining operations can potentially be done on general-purpose chips, Andreessen stressed that Bitcoin mining is much more efficient on custom, specialised silicon.

“Mining is a very specific thing that you can highly parallelise,” he said. “So I think that custom mining chips will dominate for quite a while.”

Cryptocurrency

Overall, Andreessen said that Bitcoin, and the idea of cryptocurrency in general, is the first thing that is like the Internet since the Internet itself was born.

“Cryptocurrency, and Bitcoin specifically, is the first practical way for people to do business over the Internet with no prior relationship and no central hub or trust authority,” Andreessen said. “All e-commerce and payments up until now have had to run through some kind of central authority.”

The potential for disruption is massive in Andreessen’s view, given the volume of transactions that take place daily. He noted that there is a large range of industries that exist today to service the payment ecosystem and transactions.

“So now there is a better Internet-based way to do those things, and it seems like a very, very big opportunity,” Andreessen said. “Therefore as a consequence, the amount of hardware and innovation that is put behind it is going to be gigantic.”

Are you a security pro? Try our quiz!

Originally published on eWeek.

Sean Michael Kerner

Sean Michael Kerner is a senior editor at eWeek and contributor to TechWeek

View Comments

  • It seems everybody is making money with Bitcoin. It was $4 just last year and rose to over $1200!

    There's plenty of media hype surrounding the currency but nobody really tells you the whole story.

    Do yourself a favor and find out the Secrets of Bitcoin.

    http://bit.do/BitCoinSecrets

Recent Posts

UK’s CMA Readies Cloud Sector “Behavioural” Remedies – Report

Targetting AWS, Microsoft? British competition regulator soon to announce “behavioural” remedies for cloud sector

15 hours ago

Former Policy Boss At X Nick Pickles, Joins Sam Altman Venture

Move to Elon Musk rival. Former senior executive at X joins Sam Altman's venture formerly…

17 hours ago

Bitcoin Rises Above $96,000 Amid Trump Optimism

Bitcoin price rises towards $100,000, amid investor optimism of friendlier US regulatory landscape under Donald…

19 hours ago

FTX Co-Founder Gary Wang Spared Prison

Judge Kaplan praises former FTX CTO Gary Wang for his co-operation against Sam Bankman-Fried during…

20 hours ago