Ethereum Co-Founder Warns against Crypto Centralization
Ethereum co-founder Vitalik Buterin highlighted a worrying trend during the Ethereum Community Conference. He believes the crypto industry is moving away from its decentralized roots. Decentralization is a core principle of blockchain technology. But Buterin sees a drift towards centralization.
Buterin compared this shift to the evolution of Web 1.0. The early internet promised freedom and privacy. Yet, it ended up under corporate and government control. He fears crypto could follow a similar path.centralization poses risks to user freedom and security.
Many crypto projects claim to be decentralized. However, they often have centralized front ends. These include websites and mobile apps. He calls these âstraw houses.â They look strong but are easily broken. Centralized systems are vulnerable to attacks. They can also be manipulated by powerful entities.This centralization threatens the original crypto vision. It undermines user empowerment and security.
Buterin stressed the importance of true decentralization. Itâs not just about having many validators or DAOs.
Buterin believes that decentralization is not just about having many validators or DAO voting mechanisms. Rather, he pointed to the âwalkaway testâ as the real measure of decentralizationâthat is, weather an app would still function if its core team disappeared. âBasically, if your company in all of its servers suddenly disappear, do your users still have their assets? This is like the most baseline thing that you should be trying to get out of your assets,â Buterin explained.
Interestingly, the idea echoes the logic behind the SECâs Howey Test, which is used to determine whether a financial instrument, including a crypto token, qualifies as a security.
