According to Northwestern University, Bitcoin Requires Centralization for Scalability

Research conducted by Northwestern University indicates that a balance must be struck between central banks and the Bitcoin ecosystem. According to the study, the Proof-of-Work protocol used in Bitcoin’s consensus model poses a barrier to broader adoption due to its limited transaction capacity.

Sarit Markovich, a clinical associate professor of strategy at Kellogg School of Management, stated, “When you look at two networks like Bitcoin and a central bank, one is centralized and one is not. If we want Bitcoin to scale, we have to compromise, which means we need to achieve some level of centralization.”

The findings highlight the ongoing debate around the scalability of cryptocurrencies compared to traditional financial systems.