Blockchain tech entrepreneur and innovator Vitalik Buterin says that the current wave of cryptocurrencies may eventually become a part of the centralized financial systems that they were supposed to be protesting in the first place.
Buterin, who created the first Blockchain-based computing platform Ethereum, was at a local meeting of tech startups and tech individuals in Tel Aviv, Israel when he made the statement.
The future is not as bright?
Buterin, who also supports the Blockchain startup OmiseGO, said that even if there will come a time when support for cryptocurrency will eventually be a part of the system, it will still not be replacing traditional money anytime soon. He also acknowledged that the Blockchain-based innovations may face the usual problems that also affect traditional money like big price oscillations.
“Are they [tokens] going to replace fiat? I believe no”.
There are several reasons why governments would want to keep traditional fiat such as dollars as euros, even if the nations also adopts cryptocurrency.
- Photo by Rubens Ben
Buterin also said that institutionalized Blockchain networks may hinder the growth of decentralized Blockchain projects all over the world. This may mean that technical struggles like over-regulation and the digital currency “bubble” bursting could happen. He, however, remains hopeful that the Blockchain industry will not be limited by setbacks.
At the same time, he called on supporters of digital currency to be vigilant against scamming initial coin offerings (ICOs). This is so that regulators will not get the idea of cracking down on fundraising models done for Blockchain technology. This comes after Time reported the huge decline in the cryptocurrency market when China banned ICOs.
More countries adapting cryptocurrencies
That said, more and more countries are seeing the advantages that digital currencies present. Just this year, Buterin has already met with government and central bank officials in Thailand and Russia. Some banks in Switzerland and India are also already studying implementing their own cryptocurrency systems.
Appeal of digital currencies
While people still hold Blockchain technology with a certain degree of skepticism, some appreciate its intentions democratizes money and frees people from the powerful financial structures in various industries like banks and credit card companies.
According to Huffington Post, cryptocurrency also has a mechanism for the sender and recipient not to have to share other information than what was needed, helping to avoid identity theft.