Vitalik Buterin expresses dissatisfaction with equating Ethereum with DeFi, sighs: It's better than nothing, but it's time to expand to other applications

The three-way conversation between Musk, Jack Dorsey, and Cathie Wood has attracted a lot of attention, but Ethereum founder Vitalik Buterin also shared many insights at this year's Ethereum community conference. Consistent with his long-standing vision, he believes that Ethereum's potential goes far beyond DeFi.

Ethereum Must Go Beyond DeFi

Vitalik is not satisfied with Ethereum being defined by DeFi. Although he believes it's better than having no functionality at all, he thinks it's time to move on to the next stage. He said:

To go beyond DeFi, what we do cannot just be about issuing tokens that users can earn returns on through that token, and then users earn another return by tokenizing the returns. There are those DeFi crazes, Uniswap, Aave, Compound are very successful, but Ethereum has to do far more than that.

He clarified that Ethereum being dominated by DeFi is not bad, and the reasons why DeFi has dominance today are twofold:

Centralized financial services are terrible

He gave an example, everyone uses centralized Email for communication, although multiple information agencies can view the content, users can send and receive Email within a second.

But international bank wire transfers do not work like that, these institutions are inefficient, notorious, and there are still many frictions in use.

Whales and DeFi profit farmers

Although Ethereum transaction fees are currently far higher than $5, Degen, Ape are willing to pay, but if transaction fees are a burden for ordinary users, then the Ethereum ecosystem basically cannot function, and things like decentralized social platforms, NFTs derived from tweets cannot develop in a high fee environment.

It's Time for Ethereum to Be More Than Just DeFi

As layer-two solutions become more widespread, Vitalik believes it's time to explore how to use Ethereum to solve other problems, rather than just focusing on the coin price. He pointed out:

The "goal" of these projects should not be the coin price, but "functionality," while a high coin price is good, it should only be the ultimate result of the project achieving functionality, not dominating everything.

He proposed several applications beyond DeFi, such as "retroactive public goods funding."

Retroactive Public Goods Funding

Retroactive public goods funding, where developers build public projects for free in advance, and then a decentralized organization called "Results Oracle" will retroactively fund and reward projects deemed potentially valuable.

Vitalik mentioned examples like EIP-1559, Uniswap, and the former layer-two solution Plasma. He stated:

EIP-1559 was proposed as early as 2018, but few people realized its importance, no developers started working on it, and they had no incentive to develop it, then gradually with related research released, the community formed a consensus, EIP-1559 was able to push forward.

Funding development is quite important, as with developers being more motivated in project execution, layer-two solution Plasma didn't need to spend one or two years to realize it was a dead end.

When Uniswap was launched in 2018, it received little attention until last year's DeFi boom, Vitalik pointed out that Uniswap was fortunate to convince Paradigm to invest in it, but not every project has such a happy ending.

Decentralized Social Platforms

Vitalik said that while building a social platform is his personal preference, he's not the only one who thinks so. He quoted Aave founder Stani Kulechov's recent statement claiming to build Twitter's tweets on Ethereum.

Vitalik believes the reason for doing this is simply because existing social platforms are quite terrible. The main issues include:

• Arbitrary censorship and manipulation
• Low-quality conversations
• Spam, fake information from rampant fake accounts

Resisting fake accounts means the need for a new online identity, Vitalik believes Ethereum wallet login can be a solution.

Ethereum Login Service

Vitalik proposed using an Ethereum wallet to log in to various Ethereum-based DApps, similar to common logins like Gmail, Facebook, while also establishing a versatile online identity.

He believes that an Ethereum-based login service will provide "trusted neutrality," "anti-censorship," and "built-in economic incentives," among other advantages.

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