To start with, let’s recap who Sam Bankman-Fried is. He is a professional trader who was educated at the Massachusetts Institute of Technology. He founded the cryptocurrency exchange FTX, which is in demand among users because it is “created by traders for traders”.

We checked the current data: FTX is now the world’s second-largest exchange after Binance in terms of spot trading volumes, i.e., trades at the market rate. Its result in the last 24 hours is the equivalent of $2.27 billion.

Rating of cryptocurrency exchanges by spot trading

It also has second place in derivatives by type of futures. Again, Binance ranks first in terms of trading volumes in this sector.

Ranking of cryptocurrency exchanges for derivatives trading

As it happens, Bankman-Fried is also the second richest person in the digital asset industry – and also after Binance founder Changpen Zhao. Their wealth at the beginning of April 2022 was estimated at $24 billion and $96 billion respectively. You can read more about the ranking here.

So Sam’s role in the cryptocurrency community is very large. So it’s not surprising that remarks about Bitcoin have attracted a lot of attention.

What are Bitcoin’s shortcomings

Sam voiced his views on the BTC situation in a conversation with the Financial Times today. Here’s his rejoinder, cited by Decrypt.

The Bitcoin network is not a payment network. In addition, it is not a network that can be scaled.


Bankman-Fried was obviously referring to the use of BTC globally for everyday transactions by most users of the network. In such a scenario, Bitcoin blockchain is really not appropriate because of its limited capabilities.

The Transaction Per Second Rate, or TPS in the case of BTC, is 5-7. The Avalanche network is designed for 4,500 transactions per second, whereas Solana's result for today is 4,142 transactions per second.

Transactions per second in the Solana network

The current transaction rate per second on the Bitcoin network for today is 3.46 translations. Accordingly, the cryptocurrency blockchain is not being used to its maximum, which is also important to realise.

The number of transactions per second on the Bitcoin network

Sam’s argument includes mentioning the consensus algorithm in the Bitcoin network, which is represented by Proof-of-Work or Proof-of-Work (PoW). It involves significant energy costs, which has already prompted massive criticism of BTC mining in spring 2021.


However, it is important to note that the bitcoin mining industry is getting greener. With that in mind, cryptocurrency enthusiasts believe it should once again be accepted by Tesla as a means of payment for its cars.

Despite this, Sam sees Bitcoin as having another purpose. This was made clear by the entrepreneur’s explanatory tweet, which he posted after the interview was released.

Generally, I also said that Bitcoin has potential as a store of value. The Bitcoin network cannot handle thousands and millions of transactions per second, but BTC can be transferred via the Lightning Network, layer 2 solutions and so on.

Lightning Network is an add-on on top of the main Bitcoin network, which makes transfers much cheaper and faster. It is thanks to the LN that residents of El Salvador pay in this cryptocurrency on a daily basis. It is, as a reminder, the official means of payment within the state.

However, for mass payments, users need something else. More specifically, a network based on Proof-of-Stake or Proof-of-Stake (PoS). Sam continues.

The tools with which you conduct millions of transactions per second need to be incredibly efficient, lightweight and less energy consuming. Proof-of-Stake-based networks are just that.


In other words, Sam sees a bet on modern blockchains with a more efficient transfer mechanism. His favourite project among them is Solana. Recall that back in January 2021 Bankman-Fried was ready to buy a huge amount of SOL for $3, which even became a meme. We talked about him in more detail in a separate article.

Anatoly Yakovenko CEO of Solana Labs


We believe that Sam Bankman-Fried's comments are indeed true. Of course, Bitcoin network allows to make transfers, but for a serious number of transactions it is more efficient to use other blockchains. And that's logical enough given the technologies that have been implemented in today's networks.