The debate over the adoption of cryptocurrencies that will have to go through the regulatory box has fueled the ecosystem for some time. And more precisely since that time Sam Bankman-Fried, the founder of the FTX platform, has stepped up to the plate with (very) dubious proposals. Because the topic is dangerous. And the objective should be to preserve at all costs some basic aspects such as decentralization and resistance to censorship. The reason why Vitalik Buterinthe main founder of Ethereum, has just provided some important details on this topic.
There is no doubt that the regulatory stranglehold is getting tighter and tighter on the cryptocurrency sector. A situation whose turning point has clearly been money blender tornado attack fromOffice of Foreign Assets Control (OFAC)) from the United States last August. But more specifically the diligence demonstrated by certain crypto projects and structures for enforce this prohibition without having any legal obligation to do so.
A situation highlighted by the recent transition of the Ethereum network to a proof-of-stake version which Resistance to censorship shows serious flaws. To the point that we see some of its developers considering – already – a new fork in an attempt to solve this critical problem. Possible reason why Vitalik Buterin has just made a remarkable entry into the domestic debate over the regulation of the cryptocurrency sector.
Vitalik Buterin vs Crypto Regulation
The topic is very delicate within the cryptocurrency ecosystem. But to believe that this digital economy will be able to continue to exist without any regulation is starting to look like a sweet utopia.. However, this does not necessarily mean that we should immediately abandon some of its founding principles. as Sam Bankman-Fried tried to dobefore he changes his mind.
In effect, decentralization and resistance to censorship should not be too quickly dismissed as mere details of the course. A fact he seems to want to remember Vitalik Buterin. The latter is determined to participate in this debate in order not to “let others be attacked by CT (crypto Twitter)” in an “unfair” way. But with a more measured and considered position about what is still possible to do and what seems impossible to avoid.
” Basically, especially right now, regulation that leaves the crypto space free to operate internally but makes it harder for crypto projects to reach the general public is far less bad than regulation that undermines the internal workings of crypts.. »
An acceptable regulation “frontend”.
A fair measure that explains this fixing the frontend is not necessarily the worst case scenario in the current state of affairs. Because it involves blocking access to certain sites and services like Tornado Cash, without affecting the basics of the ecosystem.
Knowing that at the same time, Vitalik Buterin considers that “the idea of a key DeFi frontend” does not seem (to him) very relevant. because ” it would annoy users but do nothing against hackers (who) are already writing custom code to interact with contracts. An obvious response to the proposals of Sam Bankman-Fried in the sector of this decentralized finance. Because ultimately the only place this user knowledge makes sense is on centralized exchanges… “and that’s already in place”!
You are not looking for big money
But obviously the real problem lies elsewhere. Because according to Vitalik Buterin, the regulatory race facing the cryptocurrency sector has been greatly accelerated by an overly enthusiastic search for “big institutional capital.” Especially considering that a recent study shows that these investment structures don’t even consider cryptocurrencies as “alternative digital assets” anymore.
But by wanting too much to move towards this more speculative, ideological or even functional kind of “adoption”, won’t we end up missing the essentials? To the point of creating cryptocurrencies a tool with strong dystopian potential. A border issue that further divides the cryptocurrency ecosystem this central issue of acceptable regulation, but also – or above all – of desirable adoption.
” Another opinion of mine that may be debatable is that I don’t think we should be enthusiastically chasing large institutional capital at full speed. I’m actually quite happy that many ETFs are being delayed. The ecosystem needs time to mature before we get even more attention. »
Maintain confidentiality above all else
Because according to Vitalik Buterin, the cryptocurrency ecosystem is still too young to absorb this kind of financial tools and players from the real economy. And it “needs time to mature” before facing the regulatory requirements that inevitably come with this type of investment dynamic. For example, by establishing “rules written in such a way that the requirements can be satisfied as much as possible by zero-knowledge evidence. »
This technology zero knowledge (ZK-Rollup) that Vitalik Buterin loves so much. And with which he always tries protect private data a little more users in the blockchain and cryptocurrency industry. With the objective of ” meet regulatory policy objectives while maintaining confidentiality at the same time“. Because we must not put profits before ideology, risking losing both…
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