Is Kaspa Overrated? My Response to Jerry Banfield

Added: 2026-05-05

[00:00:00]What's going on guys? This is James Allen.

[00:00:04]I am recording this on Wednesday, April 15th, 2026.

[00:00:10]Uh this is my second episode for today.

[00:00:12]Uh and as I said earlier, um I checked out the Jerry Banfield video where he was dissing Kaspa.

[00:00:21]And you know, I have a few thoughts on it, uh but I'm going to keep them brief because I do think the crux of the argument is rather simple. So, I'm going to start with where I agree with Jerry.

[00:00:33]Um at one point in the video he mentioned that Kaspa's emission rate was too fast.

[00:00:39]Uh the early miners made out like a bandit and the miners now are relatively struggling and sometime soon in the near future, uh Kaspa will hit its security cliff.

[00:00:52]Um uh I do agree with Jerry's point that um the emission schedule was rather too fast. Um that's that's without question that this is a valid point.

[00:01:04]However, uh there's a couple of things we should keep in mind. Uh one, the Kaspa team is human and if if something is created by human beings, there's going to be errors, right?

[00:01:16]The only perfect being that's out there is God, right? So, only God move in perfection.

[00:01:21]Human beings will make errors. So, any project worth its salt, you're going to see errors and that's one of Kaspa's mistake.

[00:01:29]But the second point is perhaps a little bit more uh important or more valid.

[00:01:33]That is, every other blockchain network is facing the same issue. Um and perhaps I should have said that when I did the video covering the Kaspa security cliff. I don't know if you guys remember that video I did a while ago where I displayed the math in regards to how much time we have until we hit that security cliff for miners. Highly recommend you check out that video if you haven't.

[00:01:54]But one thing I forgot to say in that video is that pretty much every other blockchain protocol is facing the same issue, including Internet Computer, right?

[00:02:02]Um uh most blockchain networks are subsidizing their miners.

[00:02:06]Uh the the the network activity is insufficient to cover the cost of miners. So, they're currently subsidizing it. And I know for a fact Internet Computer is massively subsidizing its node operators, which is why they're they're you know, I think they're giving them like a 60% haircut.

[00:02:23]You know, they're slashing node operators because they're subsidizing them, right? So, the security cliff critique that Jerry is pointing to Kaspa applies just as much to Internet Computer. There's not enough network activity to fully subsidize miners on Internet Computer. So, Dfinity is basically coming out of its own pocket to keep these miners alive. And that's true for Cardano. That's true for pretty much every network with the exception of a few. Perhaps Bitcoin and Ethereum are the only two network where don't they don't have the security cliff issue. But pretty much every protocol faces that issue. In fact, I was hanging out with a few blockchain developers or like a couple months ago and I mentioned my concern to them with this very issue that Kaspa is facing. And they're like, "Dude, cuz they were blockchain developers at other protocols. And they're like, "We're we're facing the same problem, right?" So, like, you know, so I I don't really think it's a it's it's a serious critique because the en- the entire industry is so new. Blockchain hasn't found like its niche, its space in the human collective yet. So, every blockchain protocol is struggling with network activity. So, uh you know, this critique from Jerry is rather silly.

[00:03:31]The second thing Jerry um uh made a remark on that I want to share my perspective on is the Kaspa team.

[00:03:39]He said, "If you if you look at the Kaspa team's page, uh there was like a donation button where you you you could donate to the Kaspa team." And he said he found that very um uh I guess he found that very like low-level because, you know, they were practically panhandling is what he called it. Not my words. He said the Kaspa team was panhandling because they had a donate button on their page. Now, th- this is straight-up silly and outright disrespectful, right?

[00:04:12]I I really think you should take that back, Jerry, because in the future tables might turn, right?

[00:04:18]And and you might want a relationship with the Kaspa team. And if you're just going to disrespect them like that, I I I I'm not sure.

[00:04:25]Trust me, Jerry, when I tell you the Kaspa team has a brighter future than Dfinity.

[00:04:30]You might want to take that back or dial that back. But let's let's look at the situation here. The fact that Kaspa's the Kaspa team is struggling economically doesn't really mean much. That's kind of part of the game, dude. Many of the big tech companies you see today uh struggled for for months, if not years, economically. Many of them even faced like a near-death experience as a company, right?

[00:04:56]Uh in that list you could find companies like Apple, which literally had like 90 days worth of cash and it was about to completely collapse until Steve Jobs returned and they got an injection of funds from Microsoft. I think Microsoft invested $150 million in Apple and literally saved the company.

[00:05:14]They literally just had 90 days worth of cash left to survive.

[00:05:17]Uh so, Apple's a prime example of a company that seriously economically struggled uh before it took off. Uh Tesla's another example.

[00:05:26]Um uh Tesla was so bad at one point that the company couldn't make payroll.

[00:05:31]Literally, the company couldn't make That's how broke and and and desperate they were for money. And Elon Musk somehow some way managed to raise money last minute and save the company. And there's many other companies in that example. You Amazon uh almost collapsed at one point financially.

[00:05:49]Uh Netflix as well. Netflix even tried to sell itself to Blockbuster for 50 million and got rejected.

[00:05:55]Right? So, I don't really know what what's the issue here with the Kaspa team having a donate button. Like, these guys are super smart. They're geniuses.

[00:06:04]They're working on something very niche, poorly understood by the general public, and they need to be funded, right? And if you're if you're a top talent, it's not uncommon to be asking people for money because you you you want them to support your research. You want them to support your work that's currently unproven.

[00:06:25]Uh I don't see anything abnormal about about that, let alone disrespect the team by calling it panhandling. So, I really think you should take that back, Jerry, because I know you uh you you have a heart. Uh you were there for me when I was like really down. So, um and tables might turn. Uh Kaspa might end up being one of the biggest protocols in the future and you might want a relationship with the team.

[00:06:49]Right?

[00:06:50]Now, let's get to the crux of the argument here because I I I have to get back to work. Well, not really. I'm going to go sunbathe. Uh you know, you guys know I'm an island boy and we we like to sunbathe. So, uh I want to wrap this up. So, let let's get to the crux of the argument. That is, we're both taking a risk at the end of the day, both you and I, Jerry. Um you're taking a risk with Internet Computer and I'm taking a risk with Kaspa because neither of us know how this is going to work out, right? And that's part of the excitement, right? We're we're taking those risks. Um uh you know, the the upside could be tremendous and the downside is, okay, we got nothing, but we we had fun, right? So, we're both taking a risk. You're taking a risk with uh Internet Computer, aka Dfinity, and I'm taking a risk with Kaspa. Now, who's leading the ship, right, on these two camps? Who's leading the ship on these two camps? On one side, Dfinity, you have Dominic Williams, right?

[00:07:43]And on the other side with Kaspa, uh I believe the the head guy is Yonatan Sompolinsky. Sompolinsky, yeah. Yonatan Sompolinsky.

[00:07:52]Uh that that has to be like Polish or something, >> [laughter] >> I'm assuming. Um anyway, um uh so, these are the two leaders you and I are following respectively. I'm following Yonatan, you're following Dominic. Okay. Now, I could tell you from experience cuz I've been on the Internet Computer side that Dominic does not compare to Yonatan. You know, Dominic is an entrepreneur. He's not really technical. He's more of a visionary. And I say this with respect.

[00:08:20]I'm not trying to diss Dominic. But he's just a visionary visionary entrepreneur as opposed to Yonatan Sompolinsky.

[00:08:27]He's not just an entrepreneur and a visionary. That's that's actually clear.

[00:08:31]But he's also a computer scientist, a well-cited um uh researcher. I mean, you could find him on Google Scholar. He's extremely well-cited and his work his technical work is brilliant. As opposed to Dominic, he's not really a technical guy. He was depending on Yon to be the technical spine of Dfinity. And Yon left, right? And I'll be even honest, I don't even think Dom knows what he's doing.

[00:08:58]Like like I seriously doubt his competency. Uh he seems to be struggling with entrepreneurial ADD.

[00:09:04]Uh he's going from one thing to another.

[00:09:06]He's going from uh a countless amount of bridges from CKE TH, CKBTC.

[00:09:12]Uh then he tried Chain Fusion, right?

[00:09:15]Then he tried Caffeine AI. Then he tried Utopia. Well, he tried Utopia first and then Caffeine AI. And after Caffeine AI flop, which I said it would, now he's on Cloud Engines, right? That's his next pet baby. As opposed to Yonatan, what I really like about him is, not only he's a genius, he's an outright genius. I know that for a fact, because when I read the V Prog yellow paper, that was like me going back to school.

[00:09:39]Seriously, that was me as a software engineer going back to school realizing I knew nothing about blockchain cuz he really opened my eyes with like the true rules of blockchain, its limitation, separation of concerns, and stuff like that. So, um uh right right then and there I knew I was dealing with a different league when I read the V yellow paper, but one thing I really like about Yan Sompolinsky is that he seems to let things happen, right? And that's very important. He He's not trying to make anything happen. He's letting things happen. He's letting the community organize. He's letting the community grow organically. Um this is an organic movement. Casper is a very organic movement as opposed to if you look at Dfinity, they're trying to force things to happen, right? They're they they they're they're pushing things forward, raising a bunch of money. By the way, Casper has raised hasn't raised anywhere near the amount of internet computer and yet they have about the same market cap.

[00:10:34]That should tell you something right then and there. You criticize them for not having enough money. Look at how much money Dfinity raised, 177 million, yet Casper and internet computer have nearly the same market cap. That should tell you something else. You also mentioned that um Casper is not listed on any major exchange. There's a reason for that. Uh Yan denied Binance's offer to be listed.

[00:10:55]He didn't agree with the way they were doing business and perhaps I should do an episode on that. I I I was thinking of doing an episode as to why uh Yan said no or stood up to Binance. But now that Jerry made that criticism, I I should probably do an episode covering why um Casper did not take that deal with Binance.

[00:11:13]Despite Binance giving them the award for the most well-researched blockchain ever. The point is this, Jerry.

[00:11:20]You're on a ship being led by Dominic William. I'm on a ship being led by Yan Sompolinsky.

[00:11:27]And I am confident, 1,000% confident, that the captain of my ship is way better than the captain of your ship.

[00:11:38]That's what this ends to. We're both taking a risk, right? But I trust my captain more than I trust your captain and I've been on your ship.

[00:11:46]Right? That's the difference between me and you, Jerry.

[00:11:51]We're just being led by two different captains. We don't have to fight it out personally. My opinion versus yours.

[00:11:56]In any case, my misfits, that's all I have for you in this episode. What is your thoughts? Do you think Yan is indeed a better ship captain than Dominic? Share your thoughts in in in the comments. I would love to know. You know what to do. Don't forget to press that like button and support me on Patreon.

[00:12:11]I will see you next time.