Vitalik Buterin responds to criticism of Ethereum being too centralized, shifts focus to Binance.

One of the familiar spirits of blockchain is decentralization, but currently, most main chains, exchanges, and even the products launched by the vast majority of blockchain companies are centralized. Among them, a representative example that has been recently discussed by many is Ethereum. The discussion stems from a recent tweet by Ethereum's founder, Vitalik Buterin (also known as V God), on Twitter.

The discussion began with a video reshared by Vitalik Buterin on 12/21, featuring a video from the BTSE exchange. Although the video did not mention any centralized issues related to Ethereum, the post still sparked intense discussions among many.

BTSE is a new exchange based in Dubai and is the first ICO issuance on Blockstream's Bitcoin sidechain, Liquid Network, with a planned sale of 50 million tokens at $1 each.

Due to BTSE's involvement in ICO issuance, most ICOs in 2017 led to the overall crypto market skyrocketing and then crashing. Many attributed this to Ethereum, prompting Vitalik Buterin to join the discussion and once again make a statement, saying:

The foolish part is criticizing Ethereum for being too centralized and blaming Ethereum for the ICO boom, then using centralized tokens to promote on a permissioned consortium chain for ICO issuance.

BTSE's Global Marketing Director, Lina Seiche, stated that Vitalik Buterin's post seemed to imply criticism of Ethereum's centralization by the team behind the BTSE video, Magical Crypto Friends. However, Seiche explained:

The real criticism should be that Ethereum is not as decentralized as it claims and has made misleading moves that misled many investors.

Seiche then emphasized that the Bitcoin sidechain Liquid Network used by BTSE to issue new tokens has never advertised decentralization and also mentioned Binance, another exchange in the conversation.

Binance recently launched Binance DEX, claiming to be a decentralized exchange. Vitalik Buterin pointed out following Seiche's remarks that although Binance DEX claims to be decentralized, there is almost "no decentralization" to speak of, making it a more suitable target for criticism compared to Ethereum.

In response to Vitalik's comments, Binance CEO CZ later replied:

There is no such thing as absolute decentralization. Projects with core teams are inevitably centralized.

Previous Confrontation

This is not the first confrontation between Vitalik Buterin and CZ. Back in 2018, Vitalik expressed his views on centralized exchanges:

Centralized exchanges should burn in hell as much as possible.

Vitalik clearly has a strong aversion to centralized exchanges, believing that projects should not have to pay a hefty sum to list on exchanges for public trading. CZ also responded to this on his Twitter:

If there were no centralized exchanges, the current development status might be ten times slower because they are essential infrastructure, such as fiat exchange windows, etc. This does not mean we are trying to profit.

Decentralization remains a difficult issue with its pros and cons, and these two, representing the technology and market giants in the blockchain industry, are likely to have a third confrontation soon.

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