I made this for you, the Kaspa holder, and I'm saying all of this because I care about you. Someone who loves you and cares about you should be willing to give you the constructive feedback that might actually benefit you, and that's what I want to do here. I want you to be a successful crypto investor. I have been in crypto for 11 years, I've researched thousands of altcoins, and I want to be completely upfront: I'm not a financial advisor, and this is not financial advice. I'll also disclose my position so you know exactly where I'm coming from. I hold tens of thousands of ICP, which is worth more than fifty thousand dollars. So that's my bias, and I'd rather you know it.
What concerns me is that I see some serious problems with Kaspa that, in my view, no one has effectively addressed. I've made a bunch of videos about them, and you can look all of this up yourself, exactly like I did. I've shown the research in past videos. Here I just want to focus on what I'm saying directly to you.
Kaspa Is a Narrative, Not a Reality
What I'm saying is that Kaspa right now is a narrative. When I look at the technology, I don't see a compelling reality behind it, especially compared to Internet Computer Protocol. Kaspa has gotten attention for some of its technical innovations, but in my experience those innovations are minor compared to the best tech in crypto.
One of the things that has really stuck with me after listening to thousands of crypto videos is that you have to think about where things are going. Are we heading toward a future of proof-of-work mining, or is proof-of-work the past? All of the proof-of-work mining narrative I see around Kaspa has one absolutely critical flaw.
Proof-of-work mining sounds good on the surface. "Oh yeah, it's fair, anyone can just start mining it." But the reality is, if you look at Bitcoin mining, it has continued to get more and more centralized over the last decade and a half, because the average person cannot just jump in and start Bitcoin mining. In this day and age, you realistically need tens of thousands of dollars of computers, the technical expertise to set them up, and a lot of cheap power to run them. And even then, you're unlikely to mine a single Bitcoin in a year. Technically you'd mine several at once if you mined any, but to have a realistic shot at mining a Bitcoin yourself, you'd need to put in hundreds of thousands of dollars in computer equipment and have cheap power. Because it's so hard for the masses to get into that, it becomes a system where the rich get richer. The majority of people can't participate, and only the elite are able to do it, so they end up with almost all of the mining.
That's the same issue I see with Kaspa. Kaspa's mining profitability is currently a significant concern. Even if the price went up, the mining still remains unviable. That means the average person is not going to participate in Kaspa mining either.
What Can You Actually Do With the Token?
When you compare proof-of-work mining to proof-of-stake, you have to think about the utility of the token. Why would I hold Kaspa? Because I think the price is going to go up. That's the only reason. There's almost nothing you can actually do with it.
And you should always compare, because comparing helps you. Here's an analogy. If you were trying to date and you put two ugly people with nasty personalities together who steal from you and lie and cheat, it'd be hard to tell one apart from the other, wouldn't it? That's most of crypto. But if you had a really beautiful person who is in shape, athletic, makes money, has a great personality, and contributes a lot, and you compared them to the ugly people I just described, most of you wouldn't even think about the first ones. You'd go for the attractive option. Internet Computer Protocol, to me, is the hot sister, the attractive option.
When I'm holding my Internet Computer Protocol, there are a ton of things I can do with it. Even if the price goes nowhere, I can vote and actually participate in governance. Holding Kaspa does not allow you to participate in governance. To me, over the long term, we are going toward proof-of-stake coins, or we're going toward centralized entities holding all of your crypto for you and doing all the transactions on your behalf. That's exactly what we see in Bitcoin right now. Almost all Bitcoin transactions go through third parties like crypto exchanges, and they don't even touch the blockchain itself.
Two Possible Futures, and Kaspa Fits Neither
So to me, crypto is going down one of two basic paths in the future. The first is that centralized entities hold everything and do everything for you. In that case, the blockchain itself is irrelevant. I don't see that as sustainable, because it defeats the entire purpose of crypto.
The second path is one where the blockchain itself does everything. Where the blockchain hosts websites, hosts entire games, where you can stake it and participate in governance, where the blockchain is your home. That's your website. That's your community, like OpenChat. On Internet Computer Protocol, this actually exists today, and it's the only crypto where this is already the reality. I think more projects like this will pop up in the future, but the others are behind, much like Bitcoin has a first-mover advantage.
Where I see Kaspa is completely left out of either path. If we go down the first path, centralized entities already hold so much Bitcoin and so much of these other coins that Kaspa isn't really needed. Sure, it's one more coin they could make profits off of by letting people trade it, but the value proposition of Kaspa being "a new Bitcoin" doesn't make sense in that first scenario. And in the second scenario, Kaspa is utterly useless, because what I see the blockchain being able to do is send transactions, and that's it. So to me, Kaspa is essentially irrelevant in the future of crypto.
I don't see why anything would change, because from what I can tell, there isn't a big enough engineering team to push the technology forward. I've been concerned about Kaspa for a long time, because if you're accepting donations on your website, and your crypto is competing against cryptos with huge amounts of money, I just don't see how that's viable long term, where the core team is operating by asking for donations.
The Funding Problem
What I've noticed about myself as a content creator is that if I'm not making enough money, I'm going to quit creating content about that category. Applying that same logic, it seems highly probable to me that the core team will at some point simply run out of funding and donations. And there's a very high likelihood that when insiders dump, this thing could go to zero, like we recently saw with Mantra. Again, this is not financial advice. Anything could happen. It's up to us, we're creating the world in real time.
As evidence of this money problem, there's an absence from major exchanges like Binance or Coinbase, and that hinders Kaspa's ability to compete with Ethereum, Cardano, and Solana. Do you know what the key to getting listed on these big exchanges usually is? Huge numbers of users and a lot of money. Does the core team have enough money to pay Binance and Coinbase to get listed? And even if it does get listed, what's the marketing plan for the long term? And then what's the real underlying technology? Ultimately, marketing and technology interact with each other. I don't see why anyone who does their research at this point would buy Kaspa instead of Internet Computer or some other crypto.
Obviously, I hold a lot of Internet Computer and that biases my opinion, but I hold Internet Computer because I believe it has the best tech in crypto. I don't care about the cult or the narratives or any of that. I care about the reality of the technology.
The "Fair Launch" Narrative and the Bots
You'll hear people say that Kaspa had a fair launch, that there was no pre-mine and no ICO. But the top addresses still control a lot of the supply. According to the newest charts, 20 to 30 percent of the supply is still controlled by the top 100 addresses. And with a narrative like this, it's very easy to intentionally spread the Kaspa out among different addresses so it doesn't look so centralized.
I hardly know anybody in crypto who is actually holding Kaspa themselves. I've seen a lot of what appear to be bot comments and bot views across different platforms promoting it, but I barely know anybody who actually has it. So this is just my view, and I have no proof of it, but I've been a YouTuber for 14 years and I've seen a lot of bot activity across every social media platform. It appears to me that there are a lot of bots pushing Kaspa content. If I made videos promoting Kaspa, I'm confident I would get pushed by a lot of bots, because it looks like other creators making Kaspa videos have a ton of bots on theirs. I've seen a lot of what look like Kaspa bots come through my live streams and hype Kaspa up, but the people never talk back. The bots just post comments hyping it up, and they never go back and forth or respond. That's a really bad sign. Plenty of other cryptos are doing this same thing with bots too, in case you didn't know how this game works.
The Engineering Race and the Real Blockchain Dilemma
The Kaspa development team is also relatively small, and you're competing against projects like ICP that have hundreds of people, including some of the most PhDs working on a single crypto project anywhere. Going into the future, if this is a race, Kaspa is already way behind in either scenario, and I don't see how it's going to catch up. I don't see how anyone buys into this without purely the narrative hype and without thinking any further.
Some people say Kaspa solves the blockchain trilemma, but I'd argue that's a fraudulent trilemma the way it's presented to you. To me, the real number one issue in blockchain is that, besides Internet Computer Protocol, there's no other crypto that can provide the full stack, meaning the website, the backend, the interface, and the blockchain all running on chain. That's the most critical issue we have in blockchain. Whatever you want to say about the Bitcoin blockchain, you can't go to a website and interact directly with it without a third party involved.
That's the real dilemma. Even with Kaspa, you need a third-party wallet, or a wallet from the development team, whatever it is. It doesn't matter, because in every case you're not going straight to the Kaspa blockchain, you're going through some kind of third party, and that third party is interacting with the blockchain for you. For example, if you have a Ledger hardware wallet and you're doing Bitcoin transactions, you're going through the Ledger third-party hardware wallet to interact with the blockchain. That's the number one actual dilemma in crypto. If there were no Internet Computer, it would be a different story.
Serving the web on-chain is the real test
To serve the web the way Amazon and Google do, to be able to deliver a full application instantly to a user, you need an enormous amount of computation behind the chain. In my experience that is the real dilemma in crypto, and it is the one thing that only the Internet Computer actually solves. So when you hear all the talk about Casper and the blockchain trilemma, remember what the trilemma really demands: you need security, scalability, and decentralization across the full technology stack. Casper does not do that. It only does that for sending transactions.
Whatever security, scalability, and decentralization the blockchain itself has becomes mostly irrelevant if you are using some third-party browser extension like MetaMask for all these Ethereum coins, a Coinbase wallet, or some Casper wallet. It does not matter what the underlying blockchain is doing, because the third-party entities have got you. They can drain your wallet. They can cut you off from using the wallet. Their wallet can be hacked or infected with malware. Again, that defeats the entire point of crypto.
Right now I have looked at the Casper Explorer, and I do not see that there is even that much activity on the blockchain itself. So the scalability of the blockchain is untested, and it does not do what you really need it to do, which the Internet Computer does. There are more issues with Casper on top of this. From what I can see, they do not even have functional smart contracts, because the CEP-20 token implementation has been described as a flop. A decade ago, delivering smart contracts and tokens was a big deal. This is not the early Ethereum days anymore. So many blockchains have fully functional smart contracts and built-in systems to create meme tokens and pump them. You can create a meme coin for free on the Internet Computer with a few clicks, and Casper is still working on an implementation that, so far, is not very impressive, just to get the absolute basic stuff that other chains have already built better.
Why confirmation bias keeps people in
I mean, guys, this looks so obviously bad to me that it is insanity to me that people are in Casper. But the main thing seems to be confirmation bias. Once you see these narratives and you do not really think them through, you just feel that get-rich energy, you jump in, and then confirmation bias sets in. I am genuinely impressed by any of you who have been able to think this through with me this far.
And there is more like this. If you compare Casper to other ecosystems, Casper's ecosystem is extremely underdeveloped. I see no reason, if I were a developer, that I would want to try to do anything in the Casper ecosystem. There are not enough people involved. There appear to be a lot of bots pushing the content, but I do not see a lot of real people actually using it, especially compared to the Internet Computer and even bigger ecosystems. If you are looking to compete with Bitcoin, that does not seem like a good market to be in. There is no clear real-world use case for this. As I described before, it is all hype and people throwing out price targets for Casper. And I do not see any institutional backing. Outside of bots and creators producing content driven by confirmation bias, I do not see any reason this goes anywhere.
A hard fork is not decentralization
Here is something else. They have to hard fork the blockchain to upgrade it. That is not decentralized. Did you hear what I said? They have to hard fork the blockchain to update it. Now, I know you take this for granted on other blockchains, but that is not decentralized. That is a centralized group of people changing the blockchain to upgrade it. That is not decentralized. And all it takes is the community disagreeing on an update, like we saw with Steemit when Justin Sun bought Steemit Inc. The community disagreed with that and split the blockchain into Steem and Hive, and both of them went close to zero.
So I do not see any key selling point, any real reason I would hold Casper outside of just hype and speculation. And hype and speculation is what all of crypto feels like to me. You need real substance, and in my view the Internet Computer is the number one crypto with real substance. Now, these are just my criticisms of Casper. I am not going to go over the hype narratives, because there are a hundred other videos that do that.
My goal here is different. I am very well versed in all of the Internet Computer criticisms too. I have come to believe that if you are going to hold something, you should be very aware of all of the downsides and all of the problems. You should have a holistic picture of it. I have a very holistic picture of my wife, the good, the bad, and the ugly, and of myself, the good, the bad, and the ugly. For every investment, you should always know the good, the bad, and the ugly. The way I see my job when it comes to crypto is to fill in the gaps. There are a lot of people talking about the good parts of the Internet Computer, and there are not a lot of people talking about the bad parts of most cryptos. If you want to go deeper into how I think about money, holding, and risk, you can explore my Money playlist.