4D Interview with V God: Ethereum will become the mainstream and the most secure base layer

Original source:The Definat，Original source:

This article is from The Way of Defi.

Vitalik Buterin wrote the Ethereum white paper at the age of 19. His goal was simple but comprehensive, to create a "world computer" designed to be a flexible base layer for all online applications without the need for any third parties. Since its inception in 2015, Ethereum has become the most active and largest smart contract platform, but has it achieved its goal of "world computer"?

Vitalik said yes and no. In this interview, it seems to Vitalik that Ethereum will achieve this goal. The bigger concern is not whether the network becomes the settlement layer and decentralized engine for smart contracts used globally, but how much value and impact the applications running on it will bring.

Vitalik explained the significance of the impending merger between the Ethereum PoS chain and its application layer, introduced the different stages of the process, and provided guidance on when it would happen. We also discuss why decentralization matters, and whether web3 user experience will become a core appeal of decentralized applications beyond censorship resistance. We discuss the current state of regulation in cryptocurrencies and how, for him, this could lead to a "tyranny of anarchy"

Vitalik also took the criticism and explained why he believes Ethereum's design is a sustainable way forward. We discussed the trade-offs of a multi-chain future, the “cancel culture” that is permeating the Ethereum community, and the beliefs that kept him fighting until the end.

Cami Russo：This podcast is hosted by Camila Russo and edited by Alp Gasimov and Daniel Flynn. Text section edited by Samuel Haig.

Vitalik Buterin：Welcome, Vitalik, to The Defiant Podcast. I'm glad to have you here.

CR：Thank you so much, it's a pleasure to be here.

I'll start by introducing Vitalik to those who don't know him, although I'm sure everyone who has heard will know him. Vitalik Buterin wrote the Ethereum white paper in 2013 when he was only 19 years old. He inspired a group of visionaries to help him build this new blockchain, which aims to be a flexible base layer on top of which to build decentralized applications - the so-called "world computer" , can run any program built on top of it, without the need for third parties.

VB：Now, Vitalik, almost seven years after Ethereum was launched in 2015, would you say it has managed to become the "world computer"?

I think it's definitely been successful in a lot of things. I think [Ethereum] has really succeeded in creating ... most of the applications described in the original white paper are actually happening, people are actually able to use them, and see what they actually look like. Many of these apps are either used, or used for something they really need.

What Ethereum hasn't really done yet is go to the whole world. If the concept of a world computer is a computer that anyone in the world can look at, and have at least some basic ability to send programs into it, and not only read it, but write to it, I think Ethereum has done that .

There's also a broader implication, which I think a lot of people have heard, that "the world just needs one computer right now, and it could be Ethereum"—that was never my intention, and I think Gavin (Ethereum Co-founder) one) did not expect the word to appear.

But there is also the idea, which has been included in the project from the very beginning, that ethereum should be a platform that is really available to the world, not only in theory, but in a very meaningful way, a lot of people can and are using it , and there are no major obstacles.

And I think there's definitely been considerable progress on that front. I visited Argentina about a month and a half ago and witnessed all kinds of people using Ethereum and other different types of blockchains as a regular part of their lives and businesses, as well as their attempts to save money, launch new projects , paying people to do all sorts of routine things.

CR：But at the same time, there are all these usability hurdles, including high transaction fees, and all these problems still exist. I still think there's a lot of work to be done if we're going to really fully realize this vision - obviously we had hoped to do it now or even in 2016. Software development always takes longer than expected, so that's okay. But obviously, the sooner we actually get all of this done, the better and closer Ethereum can be to actually realizing this larger part of its original vision.

Yes, I completely agree with Ethereum realizing its vision of being the world's computer, as it does implement most of the applications you even listed in the original white paper. I just go back and look at those applications - you said ethereum is good for token systems, derivatives and stablecoins, identity and reputation systems, decentralized file storage, DAOs, savings, insurance, decentralized data Price feeds, multisig, cloud computing, gambling, prediction markets, and decentralized exchanges.

Maybe some applications are bigger than others, but all of them are built on top of Ethereum. While I think you're right that while ethereum has become an infinitely flexible platform for builders, it's not really available to everyone in the world as you and all ethereum builders would like.This brings me to my next question, which is:The next phase of Ethereum

, aiming to achieve this scalability, the merging of the PoS consensus layer with the application layer on the current PoW chain, and of course this is a huge undertaking.

Correct me if I'm wrong, but never really tried this before, right? Piecing together blockchains to form a new blockchain — super complicated stuff — which of course is why it took us years to finally get close to seeing this happen.

So the whole point of doing this is to allow Ethereum to scale while increasing decentralization. So, what are the steps needed for a merge to happen?

VB：Progress on The Merge

At this point, it's basically testing. There are already some basic testnets and a full implementation of everything that The Merge needs to happen. There are implementations of consensus clients, and there are implementations of what we now call execution clients - so Geth and Nethermind are a lot of work.

Geth lead developer Peter Salaggi tweeted just a few days ago that Geth is basically one PR away from being ready for The Merge. PR means "Pull Request" - it's basically a chunk of code that is suggested to be added to the Geth project, and then it will actually be added and included sometime soon. But there's obviously still quite a bit of testing to be done.

The part that has been least tested and is still getting some finishing touches is what we call the initial sync process. This is when a node joins the network for the first time, how do they download existing stats, existing account balances, contracts, code and all these things so that they can become part of the network and from there, some The subtlety, how did the previous PoW parties do this, and how does the PoS party do this? So there's a bunch of technical stuff out there, and there's been tremendous progress in that as well.

CR：I think people generally feel pretty good about The Merge right now, and it's all just a bunch of technical work, a bunch of testing, more testing, and hopefully we'll be merging soon.

VB：Okay, obviously the big question is when do you think this is going to happen?

CR：Some say June, some say July or August—I don't know.

Once a merge happens, that doesn't mean developers can just wrap up and pack up and go home, right? This is the first step in a multi-year and very complex process.

VB：Can you summarize the different stages that will happen after the merger until you think: "well, Ethereum is finally done"? I don't know if you can say that Ethereum is complete by then, or at least complete in the current vision.

• I think the closest thing we have to what the roadmap I posted in December is about the five buckets I use to describe what's left to do:

• The Merge, this basically refers to PoS.

• The Surge, I mean, is increasing the capacity of the chain, basically doing sharding and doing some more stuff before that, and some more stuff after that.

• The Verge, the Verkle tree, is basically a technology that makes it easier to verify chains, so nodes don't have to be as heavy or as big computers as they used to be.

• The Purge, which makes the chain lighter and makes the code lighter by not requiring every node in the network to process and store all the old history.

The Splurge, which includes everything else that remains.

There's a lot of different buckets in there, with upgrades to the EVM, with the proposer-builder separation, and this pretty long list of upgrades with all sorts of buzzwords and all sorts of interesting projects. Then there are longer-term things like ZK-snarks, which may be ubiquitous in the Ethereum protocol in 5 or 10 years.

But, the list of things -- switch to PoS, add sharding so we can scale some, make sure we have good rollup, actually leverage sharding, make it easier for people to run nodes, make sure we don't problem, trying to make the protocol less complicated, not more complicated over time, and then make the EVM better -- I think if we do all of this, we'll do what we know we Things that have to be done today, and then Ethereum will be in a position [even if] there is nothing else to do...then we're already in a great place at this point.

If all we manage to do is PoS and sharding, then I still think we're still in a good place. There's a sense that we can do some basic stuff, and then there's extra stuff, and then there's extra stuff. The more extra things we can do, the better the Ethereum protocol becomes in some ways, and even the simpler the Ethereum protocol becomes.

CR：Therefore, if we are willing to accept more temporary complexity during development, we may gain more long-term complexity in protocol design. But that's okay if those don't get done, so there's value in solidifying as many parts of the protocol as we can as quickly as possible so people can feel safe and know how this actually works out in the long run.

VB：So basically you have some must-haves and some nice-to-haves throughout the roadmap. Is it fair to say that half of what is necessary is PoS and sharding, and the rest is icing on the cake?

CR：I think so.

Do you think Ethereum at this stage will be able to become a single settlement layer for global economic activity when sharding starts running and there are Rollups to further improve scalability?

I think Ethereum must have been big enough back then to be able to do that. I mean there is obviously still the question of "would everyone be willing to move all their activity to the same blockchain, or even any blockchain?", but from a pure "it can process transactions" perspective Looking at it, Ethereum at that time will be able to do it.

VB：Is this the most desirable outcome for you?

It's a good question, "What is the desired long-term outcome for Ethereum?" I think in addition to "Are people using Ethereum?" Ethereum?" actually benefiting from something that's on the blockchain rather than something that's done in some other way?

For example, there are a lot of projects that started out making private blockchains, and these things basically just turned into basically creating centralized systems that you might like. There are a couple of extra signatures and a couple of extra hashes in a couple of places, but the user never really sees, and never really gets, any real security, autonomy, or privacy, or any benefit from it.

Once Ethereum becomes mainstream, then I personally will definitely start to care about whether "30% of the world's population is on Ethereum" or "10% of the world's population is on Ethereum", and more attention [about] Ethereum through these applications Program [actual value that is bringing].

This is something that I think is very important right now. The bigger Ethereum gets, the more important it is to keep thinking about this question.

CR：Ethereum Endgame

VB：So for you, the most desirable outcome for Ethereum is not by looking at the number of people using Ethereum or what percentage of the world's population it is, but what they are using it for. What would you like to see people do with Ethereum?I think some of the things that people are already using Ethereum are... valuable. One of them is apparently the Ethereum onecurrency use case

, I think a lot of people do have payer needs, moving money between countries, saving, and while ETH alone provides a lot by itself, there are obviously a lot of people who don't want to deal with that much volatility, so stablecoins -- whether it's something like USDC is also something more decentralized like DAI and RAI. I think they've provided a lot for people. So here's one.

The other is DAOs. DAOs are used to pool funds together to do interesting and meaningful things. CityDAO, one of my favorite DAOs, is actually an attempt to legally own and manage a new city through Wyoming DAO laws. There's also VitaDAO, which is funding research into life extension. I think a big one [recently] is AssangeDAO - it funded Julian Assange's legal defense and looks like it's made a lot of money, so it might even end up expanding beyond that, depending on what the community decides what will it be.

I definitely want to see more different types of DAOs and DAOs being used to help people do things they wouldn't otherwise be able to do.

prediction marketprediction market

- I've long been a fan of prediction markets, and I like the use of economic incentives to encourage people to make predictions that are as accurate as possible.

One of the big problems with just listening to the media right now is that people have these pressures... to make these very confident statements and make them sound like a really impressive alpha reporter who knows their stuff, but when six weeks later, It later turned out to be complete nonsense and people really don't remember it. I think prediction markets are a very valuable experiment to see [if we can] create something better and create a tool to help people understand what is more and less likely to happen in the future. It is possible to give numbers that are actually sane and not completely crazy.

I mean, if someone wants to send me ETH for some reason, the so-called you and I don't need it at all, if people want to, then they can enter Vitalik.ETH in their Ethereum wallet, and it will automatically resolves to my address. This is powerful and really useful, but it's also useful in a lot of other situations. Some chat apps are your username and more.

Login with EthereumLogin with Ethereum

, a movement that has been growing over the past six months. Ability to log into the product with your network identity using your Ethereum account, directly competing with Google Identity, Twitter Identity, and Facebook Identity. I think Login with Ethereum is a very powerful tool because it's combined with so many other things. For example, when people sign in with Google, they're usually not just looking for "is this the same account that's logged into this account [and] created this profile correctly the first time" -- they're usually looking for anti-spam , they don't want people to be able to create 100,000 accounts and use them to make fake posts or fake upload a bunch of stuff. And Google has this very weak form of KYC, so you can have two to five accounts, but it's hard to have 100,000 accounts.

And that's what the Ethereum ecosystem can provide, 100,000 accounts with ENS domain names - it's expensive to do that. Hard to get 100,000 human proof profiles, hard to get 100,000 protocol participation proof tokens…

I just think Login with Ethereum is a great example of how all the different applications are really starting to come together and build on each other -- so I think that's really good and valuable.

Some privacy-preserving decentralized voting stuff, the CLR Foundation is an example, there are a lot of low-key experiments like this. They haven't really gotten very far so far, but I think that's a great use case for blockchain as well, combined with some unique privacy preserving zero knowledge proof stuff, basically making better governance tools .

So I think the list of interesting things that are happening more and more in Ethereum is pretty big. If we had more ability for people to use cryptocurrencies internationally, or use DAOs to organize -- whether it's a business, or a new city, or a local project, whether it's a nonprofit, or a profit, or activism, or funding Scientific research, or whatever -- I think it would be awesome to have.NFTAnother one I think I didn't mention is

, it's a very interesting double-edged sword. It's fascinating how they all end up funding completely crazy stuff and creating these embarrassing multi-million dollar ads on the internet, and NFTs also fund a lot of really important things - they fund Scientific research, they fund activism, they fund artists, they fund writers, and I think all those things are really important too.

I think these sorts of things are growing and I think being able to create really meaningful and valuable applications [but] also have the degens exciting factor is a really cool thing and I'd like to see more, ether The Fang ecosystem can find out more.

CR：Why Decentralization Matters to Ethereum

It's worth noting that all the things you mentioned have actually happened on Ethereum, because we could have had this conversation in 2017, when there was a lot of activity and a lot of speculation on Ethereum, but a lot of it was just speculation - Financing is a use case, but nothing more.

But now you mentioned all these things, a currency for cross-border transfers, remittances in stablecoins, DAOs, prediction markets, ENS, Ethereum logins, NFTs — all these things are happening. Even if some are small and just getting started, it's very encouraging to see all of these use cases in action right now.

So to do all this activity on Ethereum, going back to the previous question [about] everything that needs to happen on Ethereum to scale and support all this crazy demand for block space to support all these use cases - one might think "Why not just increase the Ethereum block size...and scale it immediately?"

To summarize the idea, why is decentralization important? I wanted to relate this question to your recent trip to Argentina - you mentioned the growing adoption of cryptocurrencies in Argentina, but I heard you say in an interview that ... a lot of it is happening on centralized exchanges.

VB：So why is decentralization important? How do you balance the fact that for the builder and the people inside the space - for many of us, the reasons are clear - but for the end user, sometimes not?

I think decentralization is one of those things where it's hard to understand why it's important until it suddenly becomes very obvious why it's important.

The most important thing is being able to build on a platform and an ecosystem that you know won't go in a completely different direction or disrupt everything you're trying to build on top of it just because it's in some small group or group people's interests. Or even just because someone got lazy and decided to stop maintaining what they were maintaining.

So decentralization is about long-term stability, which I think is very important, especially decentralization as long-term stability, even in the face of usually very strong incentives. So there are many examples of people building on top of Twitter or Facebook, they built their entire business around those companies' APIs, and then the companies themselves suddenly decided they were going to shut down those APIs...for whatever reason.... ..and the careers of these people were completely destroyed in this way. And even if that doesn't happen, then when these things become very singular, these single central points of failure, usually you end up with these other forces that end up relying on them.

One of the challenges when you start to have a lot of these centralized intermediaries is that there are a lot of people in the world who want a lot of different types of people to not be able to transact and live a normal economic life. This group is much bigger than anyone who dares to write the law, write it as illegal, and the things that are censored are much bigger than the things that are illegal. There are a lot of very legitimate industries -- whether it's political activism, the sex industry, or psychedelics -- that end up often being targeted through these very opaque and very undemocratic channels that just rely on a couple of people in the middle of some payment processor …Oftentimes, centralized companies will decide not to serve an entire country because they just think it’s too much of a money laundering risk or whatever, which ends up hurting and excluding hundreds of millions of people. I mean, I was born in one of those countries where there is such discrimination.

So if you're on a decentralized system, then you know you won't be singled out for who you are, or just because you end up vaguely falling into a category that someone else decides not to like. So I think if everything depends on centralization, then I think it's easy to have this kind of back pressure -- there are five different people between each transaction, and if you just rely on any one to give enough effort, then people You will lose the ability to trade - this is very important.

Even without that pressure. I think just creating something that you know they're going to exist in the same form five years from now is something a lot of people underestimate and I think it's really valuable... I think the internet archive makes life a lot easier for people , because sometimes somebody writes something, and then somebody writes something that becomes so important that everyone starts building on top of it. Then, for whatever reason - maybe even their hosting provider just went out of business, or some totally stupid reason - that page becomes inaccessible ten or fifteen years from now.

And often the link is broken, which is really sad, and I think more decentralization, not necessarily the blockchain, but something like IPFS, can actually solve it. But you have the Internet Archive, at least you can go and find things that existed ten or fifteen years ago, but where is the Internet Program Archive? If I want to build some financial products, and I want to build my financial products on top of Uniswap, because my financial products only need some ability to trade tokens, then if I know that Uniswap is definitely going to exist 5 years or 10 years from now Years later, I'll feel easier. Because otherwise, with every dependency I add, I'm basically taking responsibility for saying: oh, they might decide to change or disappear, and then I'll have to scramble to find something new to replace it. So I think it's important for apps -- it's absolutely important for apps built on top of other apps.

So, in conclusion, I think decentralization is important to different people for different reasons, and I do think all of them have value. I think decentralization is more valuable, the closer you get to what you really need to make sure that what you're doing continues to be possible two or five years from now. If you're just doing something one-off, and if it stops working you can move on to another thing tomorrow, then you don't really need much decentralization - maybe you just need competitiveness. You could say that competitiveness is actually a form of decentralization.

But on the other hand, if you're doing something that requires a long-term commitment, all the better. Especially if you know it's something that a powerful interest might wish it didn't exist, then decentralization is good for you. But if you're doing something in a large community, it's hard to agree on which centralized application authorities you should trust -- and that's where decentralization becomes increasingly important.

CR：Does everyone need decentralization?

VB：So you mentioned all these reasons why decentralization is important, of course, for communities and people in repressed or censored societies, for developers or builders who need to make sure their rules don't get changed ,this is very important. future, or their application can run forever - that's very important. But do you think there's a group of people or applications that don't need decentralization at all? Because right now, I think it's just a push...to put every application of the internet on top of the blockchain...do you think it's necessary?

There are certainly many applications that do not require decentralization. I think there are still plenty of applications that could use partial decentralization, but probably don't need a very pure "no servers, we do everything on IPFS and on-chain" approach.

Social media might be a good example. I think there could be a lot of benefits in creating some sort of social media ecosystem where if I make a post, the continuation of that post doesn't depend on a company deciding whether it should continue to exist, and the post and the hash of that post exist independently , other people can link to it, other people can like it, other people can retweet it, and you'll have these different and often centralized algorithms and interfaces to interact with that content. But because they have different levels of control over content, it's easier to move between them -- a vision I think has value. But to get value, you don't really need to be 100% decentralized - you can get a lot of value from 20% decentralization or 40% decentralization, and I think that's perfectly fine.

Another example might be a website for booking flights, because what you end up buying is still a centralized thing - it's a promise from a particular company to give you a seat. If one of the platforms that does this interrupts or decides to censor you, you can continue to use the other three or four, maybe even more, anyway. So when you're just interacting with something that's one-off, you generally don't need decentralization. If ... you're doing something that follows a very established pattern, very similar to what a lot of other people are doing, and has a lot of mainstream support, and your whole life is like that - then you probably won't benefit from decentralization then many.

CR：But even there, you can argue that you should get an ENS domain and start setting up your profile just in case this is something you want in the future, or that you should invest at least a few percent of your money in crypto . In case something happens to your local fiat currency. But there are certainly a lot of people out there who don't really own...the enormous value they get from blockchainizing their lives. And then there are others [who don't know anything about blockchain]... I think there's a whole spectrum in that middle ground.

Do you think there is a reason to use blockchain and web3 not because of its censorship resistant properties but because it is better [and] easier. For example... Interacting with DeFi applications - to me, this is better than having to have passwords and emails and your login codes for each different web 2.0 application. I can see that having this layer of aggregated value on the internet is better than having this separate financial system that is also geographically segmented -- which is much more clumsy than doing online transactions in a non-native online way.

VB：So do you think there is reason to think that web3 might be better, even if some people don't need the decentralization aspect?

Yes. I think that for international remittances, cryptocurrencies are generally already better than the banking system. In fact, I even had to deal with this recently [while] trying to send money to a friend who had a bank account with a smaller bank, and you can't easily send things directly to, so we had to use some corresponding bank stuff. I finally figured out how to do a bank transfer to get money from my Singapore bank account, but it was really complicated - when I did it I wasn't even sure if I did it correctly and it ended up being two weeks later The whole process was quite tense. So I basically told them 'hey, can you set up a channel to at least accept USDC or DAI or [another stablecoin]'.

Personally, even like people who donate a lot to charity, crypto is a better channel than anything in the banking system, although [charities] don't need censorship resistance.

You could obviously argue that in some ways it still indirectly benefits from censorship resistance because traditional finance inherently relies on all these different intermediaries. They're located in different countries, which adds some inherent friction - and the way encryption works is more based on ignoring all of that, and even for these rather simple and boring use cases, very valuable efficiencies can be gained.

I think there are a lot of use cases that aren't actively discriminated against by the financial system because they're not being served, because [these] systems are complex, it's hard to fix it from the existing system landscape, and there isn't much incentive to do it.

For the account system and web3, I think I'm very bullish on the "Sign-In With Ethereum" thing. Actually, I think accounts are a centralized thing, and there's this theoretical argument that people think "users aren't very good at maintaining their passwords"...or "their passwords get stolen", so you Need a friendly big brother to be able to restore your account if anything goes wrong. That's the standard argument for why Google and Facebook accounts and all that stuff have value.

But the problem with this theoretical argument is that it doesn't actually line up with a lot of people's lived experience - even now, for me, my Amazon account was just suspended two days ago because when I was just trying to buy a When you get a new phone, their AI suspects some kind of fraud. And I don't really have a good way to get the account back, which is inconvenient for me. I know friends who just lost their Google account, forgot their password, contacted support, and they couldn't get it back at all. So these friendly big brothers who are supposed to help you restore everything, they are surprisingly weak a lot of the time.

I think "login with ethereum" plus better wallet technology, so something like a social recovery wallet, can create a better product for a lot of people. It's also a good example of... partial decentralization - you can still have a centralized account with a centralized website, but you can log in with your Ethereum account. I think it's definitely a very valuable use case as well.

CR：I do think that something like logging in with ethereum is especially valuable for people who have trouble getting their phone number for whatever reason. And a lot of these [centralized] systems [didn't work as expected] - sometimes these phone number validators work well in major mainstream countries, but they end up not working well in smaller countries that people forget to think about, so I do think , even more valuable if you’re the type of person who relies on censorship resistance or relies on decentralized global accessibility. But it's definitely one of those things that has at least some value for everyone.

I agree. So the grassroots community and private sector that you're seeing in Argentina is increasingly adopting cryptocurrencies, and we're even seeing that in the United States. Whereas in other countries, it comes more from the top down – El Salvador is adopting Bitcoin as legal tender, and other countries are evaluating whether to issue a CBDC.

VB：So where do you think the biggest wave of cryptocurrency adoption will come from in the future? Will it come from these grassroots adoptions and the private sector, or will it come from top-down government adoption of cryptocurrencies as national currencies? How do these two things interact?

I definitely wish the grassroots stuff was more effective. I think this year we've even seen things like .eth domains, which have been going viral on Twitter, and a lot of people have those domains. NFTs themselves [also] are very widely distributed.

So I think that as long as the blockchain application finds that niche and finds a way that is both valuable and can truly express and present this value to many people, it is easy to explode.

I can easily see this happening in more cases. For example, I could even see logging in with Ethereum helping lead this big wave of Ethereum taking off and being used more as an identity.

[In] cryptocurrencies ... I don't really necessarily think we need a big coordinated effort. I think when people find it valuable, they find a way to use it, and it just keeps growing organically over time. I do think there is value in a coordinated effort, like creating a local area where all stores accept bitcoin, ethereum, or whatever. It's valuable as a community to say 'hey, this area is a crypto-heavy area right now, so people who are passionate about crypto -- we're all going to move there, and that can create these interesting networks. I do think there might actually be something of value, sort of like creating a city, but it's a lighter version. But there's no other way to do it either, and I wish we could try all of them.

The whole crypto game is another thing that's trying to find its niche, and there's a good chance it'll explode into something pretty successful at some point soon -- [I've seen] hundreds of different models, and Any kind of some of them could be really successful.

I think the biggest challenge with institutional adoption -- I think the value that institutional adoption can provide is that it can really reduce friction and make organic adoption easier to happen. But institutional adoption itself, when there's no organic will, I think it's something that can easily spit out and stall. There's been a lot of cases where these big companies start accepting crypto payments with a lot of fanfare, and then a few years later they realize "wait a minute, we have about 45 customers that actually use that option." So I think it's different in different situations.

For a country like El Salvador where it's completely mandatory, that's definitely something I'm more skeptical and more worried about - because when you... start forcing people to accept it, you're asking people who don't really care about it, and They basically don't even have the option to go around it and not really care about it. So exposing people in this way to massive amounts of stuff they don't understand - there are so many ways that things can end up going wrong that just end up causing people to lose money, get scammed, or even just be disillusioned. People end up even thinking that crypto is equal to what these nasty right wingers want to push, or these nasty whatever political tribes are running what a country wants to push - so it might even end up being somewhat negative for long-term adoption Influence.

But there are good things happening too, and I think Wyoming's DAO law is a great example of government-grade crypto support. They just made this law that allows DAOs to be registered entities and legally own stuff, there are a lot of people building on top of that - CityDAO is building on top of that, a lot of projects are building on top of that - so definitely I hope people An example of a good model to follow.

Miami...it's interesting...it really helps that they have Francis Suarez as mayor, a mayor who's very passionate about technology being positive and pushing all of these things forward. There's also MiamiCoin, and then there's more and more of this crypto-sounding thing happening, so it'll be interesting to see what any of these experiments end up looking like.

CR：So I think there are many ways for institutions to have a mutually beneficial relationship with the crypto space. There are good ways, there are similar ways, and there are some ways that can really backfire.

I think that's a very fair view. Therefore, real adoption comes from grassroots individuals, groups of people, and communities who want to use cryptocurrencies. Institutions can then help achieve this by encouraging innovation, building infrastructure, investing in start-ups, or simply creating regulatory frameworks that encourage innovation. So, institutions can help these grassroots adoptions by helping them thrive, but there is a wrong way to do this — and that is pushing cryptocurrencies onto people.

CR：Tough cryptocurrency regulation a looming threat

VB：On a related note, I'd like to hear your thoughts on the U.S. regulatory environment surrounding cryptocurrencies... Lately, many U.S. lawmakers and politicians have seemed more negative, skeptical, or aggressive toward cryptocurrencies. So if the U.S. wants to really crack down and limit the growth of cryptocurrencies, do you think they'll be able to limit its impact and force it into this very niche thing? Or do you think cryptocurrencies are strong enough and decentralized enough that even with this very tough approach to cryptocurrencies in the U.S., it can still become mainstream elsewhere?

I think if the United States takes a very tough stance, it will definitely be difficult to do a lot of very important cryptocurrency things in the United States, but it will definitely continue to go all out.

Outside of the US, I think a world where many countries ban crypto and try very hard to ban it will definitely make crypto more difficult, especially if good things are built on top of crypto and try to stay connected to existing world prosperity. One of the tragedies I think the current regulatory status quo is potentially falling into is what you might call an anarchist tyranny.

So anarchist tyranny is this political buzzword that people have been using — I forget who exactly coined it — and it’s been around for 50 years. But that's basically this idea of ​​a state of government, basically like anarchy that has bad meaning to people who do bad things, but is a kind of tyranny to those who try to do meaningful things.

Sometimes San Francisco is even described as such - even for those who try to steal from stores so tolerant that they often have to lock everything up or even close their doors. However, if you want to open a new restaurant, good luck with your $100,000 license. It's backwards, right? We want the robbers, not the restaurants, to have to pass hundreds of thousands of dollars in permits, and hope the robbers never get through.

The analogy in the crypto space is if we just look at token financings, the problem is that a lot of times what happens is we have projects that, in order to comply with securities laws, end up explicitly saying, “This is a token that has no value. There is no connection, we make no promises, and if you buy it, you're basically giving us a donation." So basically the legal structure that prohibits this broad class of things doesn't go through this registration process which is basically for crypto projects It's impossible to end up pushing a lot of projects into these alternative structures and they end up either not being open to the public at all or only to this extremely limited group of investors - basically you have this situation where the rich go In the front, and then open to the public, the public can only buy in at all-time highs, so the public is exploited anyway. Or they create these structures that are basically public, and instead of buying something that they have an actual guarantee about something, they're basically buying it where there's no guarantee at all other than the goodwill of the developers.

So in these well-meaning DeFi projects, projects like Uniswap are getting subpoenas and spending huge sums on lawyers, but we have outright criminals stealing millions of dollars. I feel like if the opposite was the case - if DeFi projects didn't have to deal with so many regulatory issues, but at the same time had more work to do after all these multi-million dollar thefts - that would be a huge challenge for everyone. better world.

But the challenge is that anarchic tyranny happens because they are easy. Because if you want to do something meaningful, then in a sense you have to make yourself vulnerable -- you have to have a presence, you have to do things that require long-term planning, you have to have a team -- So doing something meaningful and valuable makes you more vulnerable than just doing something completely destructive.

Basically, a trap that's usually easy to fall into is one that's harder for the first thing than for the second, and I think that's a real risk that I do see a lot of regulation go into -- in A [trap] that creates more obstacles in front of meaningful things.

CR：Then face the reality of things like this theft and scams that no one wants to see... the crypto community is willing to participate so there can actually be better options. It's a hard problem -- I think the reason it hasn't been solved is that it's a hard problem, but I do think it's something more people should think about and study.

It’s ironic that regulators criticize cryptocurrencies as a wild west — but that’s because they’re making it a wild west. They just refuse to properly regulate it, and don't solve the problem, don't create any structure around it, and projects kind of have to do these weird structures, and they guess what security looks like, but no one has ever done it. So they do these things like you said -- not giving their investors proper ownership because it appears to be a security, and [saying] these things, like, "Oh, maybe it's related to future income, But not really" - it just leaves everyone unprotected, so I don't know what the prospects are.

VBI don't know if you agree or not, but it's kind of bleak because there doesn't seem to be a path forward - no one is offering any guidance that we might get out of this, at least in the US.

: One answer might be that it might actually be easier to influence, suggest and actually try out what's better for everyone outside of the US. So the only way to be persuaded is through a successful presentation - which may actually be one of the answers.

I think given that we both have substantial [backgrounds] outside of the U.S., we're definitely better suited than [some] to look at those options -- a lot of the loudest voices in crypto are people who have basically spent their entire lives working on America, didn't really think about anything outside America.

I'm guessing you're either convincing through words or presentations. But the way you're convincing through words that actually work at this point is basically suggesting some new alternative that enough people think it's reasonable enough that it's going to work, it kind of smells like pushing the needle forward.

It also doesn't have to be a federal level thing, maybe something could be done at the state level. As I mentioned, the way Wyoming enacted the DAO law... As far as I know, I don't think it has enabled any bad things that wouldn't otherwise exist, but it has enabled a lot of meaningful things - as I mentioned Yes, CityDAO is a good example and I think there are bound to be many others.

So maybe it's just a question that we need more minds to focus on and study.

CR：Vitalik strikes back at Avalanche on L2 scaling

So I recently recorded interviews with other guests, and I'd like to hear your thoughts on some of the arguments they've made -- arguments against the way Ethereum works in a way.

VB：One of the guests was Emin Gün Sirer from Avalanche, and he had a very provocative argument, saying that "any layer 1 blockchain that relies on a layer 2 scaling solution has capitulated." His argument was, Relying on L2 would greatly reduce security and increase complexity, and he believes that blockchains should be able to scale from their core mainnet layer.

Sounds to me like the capitulation of any country that relies on corporations for people's basic needs, right? To us, that sounds like an unrealistic claim.

L2 is part of a larger ecosystem of L1, I think the ecosystem is symbiotic with other ecosystems... I think the Arbitrum ecosystem is part of the Ethereum ecosystem, the StarkNet ecosystem is part of the Ethereum ecosystem, the optimism ecosystem is Part of the Ethereum ecosystem, same as the Loopring ecosystem and Polygon.

I see nothing wrong with relying on this beneficial interaction between the different parts and the whole, and I even think it can lead to important benefits. For example, historically the Ethereum Foundation -- business development has not historically been one of its strengths, you could say part of it is really wanting to keep you know neutral and pure and other important things, but its Part of it may be that we don't have a certain talent ourselves.

Polygon, for example, actually does have a business development business, and they've had quite a bit of success doing that recently. Not just them, there are many other L2 projects.

CR：So I don't think there is anything wrong with scaling through L2. We need to stop thinking of chains as chains and start thinking of them as ecosystems, different parts of the ecosystem can certainly provide important tools and complement each other. I think it's very healthy and very good.

VB：Do you think this is a safe way to move forward and build?

There is no technical reason why L2 is unsafe. Technically, the logic of how they work — whether it’s Rollup or the Lightning Network — these things have been understood for years.

CR：So I don't really see a security risk of L2 extensions that don't exist in Layer 1 extensions. In fact, I think L2 scaling is better for experimentation, because you can roll out different parallel scaling methods, and you don't really need to put all your eggs in one basket to achieve the same degree. So yeah, I don't think that's a problem.

VB：Ok, I think usability is the problem L2 is facing right now?

Yes, I think this is a real problem. I think we can definitely do more to improve it. I think we can do more to improve people's ability to move assets between different L2s. There is much more we can do to improve people's ability to move safely between different L2s. I think there's a big difference between being on a Loopring or Arbitrum and being on an Avalanche.

[With] Avalanche, you're connecting to a separate L1, whereas with Arbitrum, you're basically moving to a platform that's actually secured by the underlying blockchain. At the moment, Metamask and other browsers don't really [do] a good job of making a clear distinction to the user, which I think is important...

There is definitely more usability work that could be done. Both plain old regular usability about the ecosystem, making it easier for people to understand the concept of jumping between chains and what happens when they jump between chains, and usability... and making it clearer to users what's going on What -- and under what circumstances are they actually safe, under what circumstances are they not safe, but those are things that a lot of people struggle with.

CR：Security Flaws in a Cross-Chain World

So this is very relevant to a recent article you wrote where you said "the future will be multi-chain, but not cross-chain".

You say there are fundamental security constraints on bridges between chains. As you explained, you don't think there is a security risk in moving assets between Ethereum and L2, but there are security risks in moving assets between Ethereum and other chains. I guess you were vindicated recently in the wormhole bridge hack - that happened a few days after you posted it, so it was like "oh, Vitalik was right".

VB：However, it makes sense that the risks of living in this cross-chain world are far greater. But if that's the case, the future lives in these L1, and there are L2 scalability solutions, maybe with different communities using different blockchains - do we lose this key feature of blockchain and crypto composability ? Are we not going back to another walled garden?

I think blockchain bridges are here to stay. As I mentioned in the post, one corollary of this thinking is that there is this anti-network effect of bridge security, where bridges become less secure if a lot of people use them, but it also means that if they don't then Multiple people use them and they will be very safe.

So there will still be some people using them. Even without any bridges, there would still be decentralized exchanges, so...it wouldn't be that...with these walled gardens, you can't move things between them at all. You'll be able to own your Solana tokens on Solana, and then you'll be able to trade them decentralized on Ethereum for ETH, and then trade them for Bitcoin on the Bitcoin network -- the tools to do that are getting better and better. Getting more efficient, and I think they'll just continue to get more efficient.

So it's definitely still possible to be a multi-blockchain jumper where you have to do some things on some ecosystems and some other things on other ecosystems and you need to jump between them.

The only thing we won't see much is Ethereum native assets on applications on Solana and vice versa - but I don't even think we necessarily need to.

If your application uses Ethereum-native assets, it can be on Ethereum, but if your application uses a lot of Solana-native assets, they can be on Solana. If people want to borrow both, they can just use one app that works on both sides. I don't think we're really losing that much from that interoperability compared to the maximum interoperability where every asset can be delivered anywhere. The reduction of tail risk and systemic risk to the ecosystem is absolutely very important.

I think one way to think about this analogy is one way of doing walled gardens, if you use Twitter and Facebook, then you can have people have content pieces that point to pieces of content created by other platforms. But another kind of interoperability could be, if Facebook is able to make an API call where you can retweet, you can see that the second is more dangerous than the first.

In the case of cryptocurrencies, there is a difference between messages and assets. Once you start transferring assets, you gain this higher level of trust.

This is a very complex, interesting, technical rabbit hole. A lot of things in crypto go down these technical rabbit holes, and it's hard to come to a single conclusion where we can say "yes, one word" and "shh, another word" - it really depends on the context.

You can still interoperate, and you can interoperate in a number of ways, but there's always this sort of inevitable risk premium that comes with this particular thing about jumping assets, and I guess that's the conclusion.

CR：Ethereum and Bitcoin

VB：Yes, makes sense. So another guest I had earlier was Edan Yago, who is building a DeFi application on top of Bitcoin. He... thinks Bitcoin is the only legitimate layer for decentralized applications on web 3 because it's the most trusted blockchain, it's the most decentralized, it's the most secure. So, to him, if we're going to rebuild the financial system, it should be on top of the most secure blockchain -- if he's going to build his application on Ethereum, he's going to be using an unreliable foundation. I think this echoes a lot of Bitcoin minimalism.

I think I have two ways of answering. One is that this is more of a provocation, and the other is that the point makes sense.

It is a provocation because this year, Ethereum is turning to PoS, which is better and more secure. So after The Merge, Ethereum will actually be the most secure base layer. It's trolling[ish] because Bitcoiners will just yell and say "we disagree with this", but it's my belief and I've written a lot of long posts about why in a lot of places.

It makes sense because I think there are some interesting differences - this is an article I wrote a few years ago called "Base Layers and Functionality Escape Velocity". The core idea is that base layer decentralization is not enough; the base layer also needs to be able to build things on top of it without adding additional centralization in the middle.

So a possible analogy is, imagine if you had a country that had very real liberal rules about political morality -- very strong property rights, and if you had a piece of land, you could do whatever you wanted on it want to do it. But a piece of real estate is indivisible, the only real estate parcel that exists is a city-sized parcel of real estate, so the only parcel of real estate that currently exists and has title attached to it is the size of ten by ten square kilometers, and you can't divide them. The only thing you can do is you can enter into legal contracts that are enforced by the court system, but even there people can go bankrupt and weird things can happen.

In that world, it looks like the base layer fully respects property rights, and it looks like the base layer does everything that people who care about that sort of thing really want. But because the base layer only deals with these institutionally large chunks of property, from the perspective of a person living in the country, they may not actually have that much freedom.

And the reason they don't really experience that much freedom is because if they want to really live, they're going to have to live in what is essentially one of maybe a thousand private cities with all the Any rules that have, if the underlying culture is fairly authoritarian, if the culture is fairly conformist, all of these cities might actually be pretty bad at respecting people's rights.

So the moral is, even if your base layer is decentralized, in this particular case, it's not functional enough...to allow people to actually own their estate, not just with Incredibly large cities of the size of people to build relationships with large tracts of land. Because it doesn't have that function, it turns out that the level of experience of living in this country with freedom and sovereignty and whatever you want to call it, isn't really that high.

So I think Bitcoin is somewhat similar in that the Bitcoin base chain doesn't support complex scripts -- it doesn't support what we call rich state, so it's not possible to create Rollups on top of Bitcoin. The only scaling solution it can support is the Lightning Network, you can't create Rollups on top of Bitcoin, you can't create Plasma chains on top of Bitcoin, you can't create complex smart contracts on top of Bitcoin.

So, for example, let's say you adopt the Ethereum Foundation's multisig. The way Ethereum Foundation multisig works is that there are seven participants, and you need four out of seven to transfer large amounts of money. But one in seven can withdraw small amounts of money every day, up to a certain amount. The problem is this "up to a certain amount per day" thing - doing it requires being able to remember that you've made a trade and you've made a trade of this size. That's not something the bitcoin script language can really handle.

CR：So if you want to build this design on top of Bitcoin, you have to build it on top of the system that exists on top of Bitcoin. But then the system actually has to add its own trust assumptions. So if you take Liquid as an example, Liquid is a multisig. It's basically a permissioned consortium blockchain, but it's licensed to run by people the bitcoin community trusts, so it doesn't fall into the same category as what some banks are doing right.

BV：Is rootstock the same?

I think, in its current form, yes. I believe their long-term vision is that they actually want Bitcoin miners to strengthen the connection between Bitcoin and Rootstock, but I haven't actually looked at Rootstock in a while. If you invite the Rootstock folks, we'll be happy to get them corrected.

But if they can get miners to agree on enough things to make Rootstock what I call "trustless," they'll basically turn Bitcoin into something very different from what Bitcoin is today. It's basically like doing a soft fork, which would be an interesting way to upgrade bitcoin, but we have to call it -- it's upgrading bitcoin, and if you upgrade bitcoin, then you can give it a Functionality Escape Velocity.

CR：So I guess Bitcoin in its current form doesn't have Functionality Escape Velocity. It does have a lot of true decentralization that a lot of chains don't, but Bitcoin doesn't have anything else either. So because it doesn't have this Functionality Escape Velocity, because it doesn't have enough functionality to build whatever L2 you want to do, no matter what L1 doesn't do on top, the self-level user-experienced sovereignty ends up being heavily mediated, much lower than theoretically chain level provided. If Bitcoin wants to improve on this, it has to add functionality. I do know some people want to do that, and I think that's fine, but that's how it is today.

It's interesting because they're building on top of Bitcoin because of all these different features, but to do that they need to be building on top of layer 2, and when they do, they're dropping those features.

CR："Cancellation culture" is starting to catch on on Ethereum?

Before we wrap up this podcast, I wanted to get your thoughts on the latest Ethereum crypto Twitter controversy. People have made different tweets or statements or comments in the past that were racist or misogynistic, or just something that others in the Ethereum community disagreed with, so those things got them fired or emigrated. The de-role people have come across these statements and so on - so basically the "revocation culture" has come to Ethereum.

Probably the most notable case happened to someone from the ENS you mentioned. In 2016, he said that homosexual behavior is evil, that transsexualism does not exist, that abortion is murder, and contraception is perversion — all of which go against many values ​​held by many in the Ethereum community. So he lost his community role because of this sentence.

VB：I think this is a very tricky question. I am 100% a free speech advocate - I want everyone to have the right to say whatever they want without fear of reprisal. But at the same time, I've also seen people say 'these are public figures, they're building for a community that wants to be inclusive, they speak out against many members of the community, they feel hurt, etc, they're not Ethereum or they A good representation of the application being used. 'Where is your stand?

Yes, I think I definitely have some different, complicated and nuanced views on this. I think one of them is that I think Brantley's failure last week was definitely not just a point of view that a lot of people disagreed with. Another big failure I think he had was when the whole drama happened, he responded by first holding a Twitter Space where he not only doubled down on the opinions, but doubled down on them in a really clumsy way- A lot is hidden behind "my religion tells me to believe this, so I believe this" and in a way that doesn't really make people feel like he understands or engages with these opposing views.

At the end of the day, he's the main representative, he's the company representative, he's the representative within the ENS DAO, and when you're in a political role, it's part of your job to be able to handle disputes well.

So I don't think you can even claim he was kicked out for something that had nothing to do with his ability to do a good job -- and I think that's true in some respects. This is a delicate point.

I guess another subtle point... what is often overlooked here is that there is an American-centric aspect to the culture that unfortunately gets exaggerated every time something happens. If you pay close attention to these recent deplatforming debates, you will find that the most vocal opponents of deplatforming are usually foreigners, and often even foreign dissidents fleeing the culture of takedown. Should we say even more drastic than what America has.

So Alexei Navalny, this Russian dissident, unfortunately for the past year or so, he's been languishing in prison, he was about a year ago Donald Trump was kicked out of twitter as one of the loudest opponents because in the end precedent does matter and when you do something you're usually legitimizing that action, including by long Chronically performed behavior by other people that you do not like and cannot control.

This is something that I think people need to keep paying attention to. Just from my personal observations, I've seen ethereum community members in latin america, there are some ethereum community members in china who have absolutely no knee-jerk hostile views on what's going on, but definitely "okay, we need to be careful this.

So when things like this are done, it's important that they're done in a way that clearly shows what's actually being done, what's the value behind what's being done, and why this won't set a precedent, for example, in the future, like the ENS DAO Might make a protocol change to remove .eth domains from people they think have bad opinions...  

Few want ENS to go in that direction - I certainly don't want ENS to go in that direction - but it needs to be clearly communicated why what's been done this week isn't the first stepping stone to doing something similar. I believe this can be communicated clearly, but it has to be. That's the second subtle point, I guess.

A third nuanced point is that I'm personally in favor of having at least a 14-day cooldown before anyone gets fired for a scandal. I would personally like it if it was a general social rule that everyone has, and numbers even higher than 14 would be even better.

Yes, it does mean that some people will be very uncomfortable and they just have to live with the discomfort for a while. But at the same time, I think it's very healthy to sit in the discomfort and not make knee-jerk decisions that are...a muscle that we need to exercise, and I think it's also better for clear communication to the community, What is done is the result of deliberation.

But the fourth subtle point is, I think one of the great things about the Ethereum community is that it's so diverse, and it has these different subcommunities, [but] Ethereum doesn't belong to any of its subcommunities. I think it does allow subcommunities to be more opinionated.

Some people were "de-referenced" in certain Ethereum subcommunities, and those subcommunities did continue to prosper in other Ethereum subcommunities. Ameen is probably a good example, there are plenty of sober people who don't like him for various reasons. But at the same time, he had RAI, The Money God, and Moloch DAO — all these projects. There are a lot of people who are happy that he stuck to himself, and that he continues to prosper that way.

So I think it's important not to over-catastrophize and over-interpret sub-communities of ethereum that behave in a particular way [and think] 'oh, these are the values ​​of ethereum right now. 'Ethereum is big, Ethereum is worth a lot, I don't know' Don't think myself or any Ethereum sub-community really have the right to define what all Ethereum stands for, I think it's healthier that way. But it does...mean that we should be careful to protect the Ethereum base layer from such controversies.

For example, sometimes people argue that [we] should issue more ETH to fund some base layer public goods at the protocol layer. This is actually a good argument for do we really want the whole ethereum community to disappear...basically forced to create this big collective social signal that ethereum is standing in one direction or the other on a certain issue The direction, ultimately, is entirely global and debatable.

I think a lot of people do come to ethereum as a refuge from their local political issues. The world is big, and in many cases, seeking refuge from your local political issues is a perfectly legitimate thing to do and should not be vilified at all, and Ethereum becomes a reflection of... this very particular part of the concern A world of some particular problems and not others would certainly limit its potential as well.

CR：So, yeah, I don't know -- that's unfortunate. I'm not going to wave a flag like "Free Brantley" or "Get Out of Brantley" or "Come on, Brantley." Unfortunately, [I] only have some complex views, because the whole thing itself is complex.

yes, I agree. This is a topic that needs to be treated with nuance - I don't think there is a straight answer.

VB：Finally, a quick question to end. So I've been asking each guest what makes them rebel. how about you?

What makes me rebel? That's a good question. I feel like I have contempt for a lot of things — I have contempt for token voting governance, and I have contempt for a lot of people wanting to take very short-term actions that push the crypto space in a direction that looks good in the short term but is not actually sustainable.

What am I up against lately? I think I challenged Avalanche on Twitter yesterday, and it was definitely a challenge.

On the other hand, I feel like I don't really represent that I'm radical because I'm just trying to think about different issues and whatever my opinion is, that's my opinion. The less predictable the views of others are from their views, the more valuable those views are. So I'm definitely trying to really think about things separately and not let anyone's existing box guide me.

CR：I don't think I can give you a specific thing but you get a long list and if you want to know what that long list is, I've been writing a lot and tweeting about it for a while now, I May continue to do so.

Yes please go ahead! These are the best.