Vitalik Buterin says that money, blockchain identities, decentralized finance (DeFi), decentralized autonomous organizations (DAOs) and hybrid applications are the top developments he is excited about in the Ethereum ecosystem. In a Dec. 5 blog post, the Ethereum co-founder describes his experience of using Ether (ETH) as a means of payment in a cafe in Argentina:
“When we walked in, the owner recognized me, and immediately showed me that he has ETH and other crypto-assets on his Binance account. We ordered tea and snacks, and we asked if we could pay in ETH. The coffee shop owner obliged, and showed me the QR code for his Binance deposit address, to which I sent about $20 of ETH from my Status wallet on my phone.”
That cafe visit occurred last December, when Ethereum was still proof-of-work, so the transaction didn’t really make “pragmatic sense,” Buterin conceded. Network fees accounted for one-third of the transaction, and the funds took several minutes to arrive. But due to Ethereum’s merge to proof-of-stake in September, “transactions get included significantly more quickly, and the chain has become more stable, making it safer to accept transactions after fewer confirmations.”
Then, addressing the rise of DeFi, Buterin wrote that the industry started off honorably but quickly became “an overcapitalized monster that relied on unsustainable forms of yield farming.” However, he added that DeFi is in the “early stages of setting down into a stable medium, improving security, and refocusing on a few applications that are particularly valuable.”
Honestly I think we emphasize flashy defi things that give you fancy high interest rates way too much. Interest rates significantly higher than what you can get in traditional finance are inherently either temporary arbitrage opportunities or come with unstated risks attached.
— vitalik.eth (@VitalikButerin) June 20, 2020
Next, Buterin praised the rise of blockchain identification methods, such as Sign In With Ethereum (SIWE), and their ability to enhance user privacy. “It [SIWE] allows you to interact with a site without giving Google or Facebook access to your private information or the ability to take over or lock you out of your account,” wrote Buterin. Furthermore, he said such protocols could also be used to prove eligibility in events like governance or airdrops without compromising users’ personal data.
Regarding DAOs, Buterin said while the term “captures many of the hopes and dreams that…
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