Ethereum’s co-founder was bullish on the rise of decentralized blockchain identities to protect user privacy.
Vitalik Buterin says he is excited about the Ethereum ecosystem: money, blockchain identities, decentralized finance (DeFi), decentralized autonomous organizations (DAOs), and hybrid applications. In a blog post on December 5th, the co-founder of Ethereum describes his experience using ether
ETH
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How to pay in a cafe in Argentina:
“When we walked in, the owner recognized me and immediately showed me that he had ETH and other crypto assets in his Binance account. We ordered tea and snacks and asked if we could pay in ETH. The cafe owner insisted. A QR code for his Binance deposit address showed me, I sent about $20 ETH from my phone’s status wallet.”
That visit to the coffee shop happened last December, when Ethereum was still proof-of-work, so the transaction didn’t really make “practical sense,” Buterin admitted. Network fees account for about a third of a transaction, and funds take minutes to arrive. But due to Ethereum’s proof-of-stake merger in September, “transactions are included much faster, making the network more stable, making it safer to accept transactions after fewer confirmations.”
Then, referring to the rise of DeFi, Buterin wrote that the industry started respectably but quickly became an “overcapitalized monster dependent on unsustainable yield farming.” However, he added that DeFi is “in the early stages of becoming a sustainable medium, improving security and refocusing on a few particularly valuable applications.”
Next, Buterin praised the rise of blockchain authentication methods such as Sign Up with Ethereum (SIWE) and their potential to increase user privacy. “It [SIWE] allows you to interact with a site without giving Google or Facebook access to your personal information or the ability to download or lock you out of your account,” Buterin wrote. Additionally, he said, such protocols could also be used to prove eligibility in events such as hijackings or plane crashes without compromising users’ personal data.
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Of The DAO, Buterin said, “capturing many of the hopes and dreams that people have placed in the crypto space to build more democratic, resilient and efficient forms of governance,” more work needs to be done to improve censorship resistance and sensitivity. Internal organization. Highlighting the example of MakerDAO, Buterin wrote:
“MakerDAO has $7.8 billion in collateral, 17 times the market capitalization of the profit-taking token, MKR. So if governance is safe for MKR holders, someone can buy up to half of MKR, use it to manipulate price prophecies, and steal. much of the collateral for himself.” ”
Finally, the co-founder of Ethereum noted the possibility of merging the Ethereum blockchain technology with off-chain processes such as voting. In one case, Buterin wrote: “Votes are published on the blockchain, so users have a way independent of the voting system to make sure their votes are included. But the ZK-SNARK-based solution encrypts votes and preserves privacy.”
As for next steps, Buterin stood by his belief in prioritizing projects with long-term value propositions over those fixated on short-term profit. “More stable and boring applications are not created because there is less excitement around them and less short-term profit: LUNA’s market value reached $30 billion, while stable money that strives for stability and simplicity often gets more.” Ignored for years,” he wrote. After the merger, the next major expected update for Ethereum is the Shanghai Hard Fork, which will allow users to withdraw their Ether. The renovation is scheduled for the second half of 2023.
