Vitalik Interview Summary | Criticizing CBDCs, Praising Binance, Expectations for Ethereum in the Next Decade

Ethereum co-founder Vitalik Buterin recently attended the ETHPrague 2023 summit and gave an interview to CNBC, where he praised Binance's popularity in countries like Argentina, criticized CBDCs, and emphasized the anti-censorship capabilities of proof of stake over proof of work.

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The Next Decade of Ethereum: Building Practical Applications

CNBC pointed out that Vitalik is very concerned about whether his vision of financial inclusion can be realized. The biggest challenge facing the Ethereum community and Vitalik now is to bring real value to the public.

Vitalik said:

My overall view of the Ethereum ecosystem is that the past decade was a period of exploration and trying to develop Ethereum correctly. The next decade we are facing is one where Ethereum must truly create practical applications that people will use.

Vitalik Recognized More Often in Argentina than in San Francisco

How to prove that cryptocurrencies are more well-known and widely used in developing countries? Vitalik stated:

When I visited Argentina at the end of 2021, many people were using cryptocurrencies and many liked them. The number of times I was recognized on the streets of Buenos Aires, the capital of Argentina, was indeed more than in San Francisco.

Vitalik pointed out that what people in low-income countries find basic and boring, such as convenient payments and savings, is bringing them real value through cryptocurrency applications.

In fact, when lacking these financial infrastructures, people are also uninterested in more abstract applications like decentralized social interactions.

Vitalik: Everyone is Using Binance

Vitalik mentioned an anecdote where he casually found a coffee shop in Argentina that happened to accept BTC and ETH payments, but the issue was that these businesses were all using Binance instead of decentralized wallets.

He did not blame Binance; instead, Vitalik praised them:

Binance provides a smoother user experience for users with a per capita GDP below $10,000 and who do not understand blockchain technology, but it needs to become more decentralized. Centralized entities are easily influenced by external pressures and internal corruption.

He told CNBC that the ideal solution is to get rid of centralized entities and significantly optimize for global adoption.

Vitalik pointed out that Ethereum transaction fees must be below $0.05. Although this statement is often brought up to criticize Ethereum Gas Fees when they are high, Vitalik emphasized this figure once again.

CBDC = Frontend for Banks

Regarding the CBDC issue, Vitalik said that five years ago, he was hopeful about CBDC, but perhaps he was too naive.

He pointed out that over time, the development of CBDCs has become more aligned with the banking system, like another version of the existing banking system but with more surveillance mechanisms built in.

As privacy protection gradually disappears, so-called CBDCs are not better than existing payment systems; they basically become another frontend system for existing banks.

Proof of Stake (PoS) Is More Resistant to Censorship

The issue of censorship resistance between PoW and PoS is often discussed, especially after Kraken was fined by the SEC earlier this year for unregistered staking services, and the problem of Ethereum nodes having a high presence in the U.S. was scrutinized.

However, Vitalik insists that PoS is more likely to resist government interference:

Compared to PoW, PoS is easier to remain anonymous and harder to shut down. PoW requires a lot of physical equipment and power, facilities that anti-drug agencies have extensive experience in detecting. To execute PoS, all you need is a VPN and hide your laptop in a corner, which, although not perfect, is much easier to conceal than mining rigs.

He even envisioned the worst-case scenario:

Even if the Ethereum Foundation received magical freeze orders in all countries and I encountered certain issues, all independent verifiers could still keep Ethereum running.