Vitalik Buterin Blames Rising Transaction Fees for Web3’s Drift from Decentralization

Ethereum Vitalik Buterin Web3

Author

Jai Pratap

Author

Jai Pratap

About Author

Jai serves as the Asia Desk Editor for Cryptonews.com, where he leads a diverse team of international reporters. Jai has over five years of experience covering the web3 industry.

Author Profile

Share

Copied

Last updated: 

December 29, 2023 01:13 EST

Why Trust Cryptonews

Cryptonews has covered the cryptocurrency industry topics since 2017, aiming to provide informative insights to our readers. Our journalists and analysts have extensive experience in market analysis and blockchain technologies. We strive to maintain high editorial standards, focusing on factual accuracy and balanced reporting across all areas - from cryptocurrencies and blockchain projects to industry events, products, and technological developments. Our ongoing presence in the industry reflects our commitment to delivering relevant information in the evolving world of digital assets. Read more about Cryptonews

In a recent blog post titled “Make Ethereum Cypherpunk Again,” Ethereum co-founder Vitalik Buterin expressed concerns about the veering trajectory of Web3 from its original vision.

Buterin contends that the foundational principles of Web3 have gradually receded as various projects within the cryptocurrency space shift focus away from the core idea of decentralization.

Web3’s Ideological Shift: A Growing Divide

Buterin identifies a substantial ideological divide, where segments of the non-blockchain decentralization community view the crypto world as a distraction rather than a kindred spirit and potent ally.

Initially coined by Ethereum co-founder Gavin Wood, the term Web3 was conceived not merely as ‘Bitcoin plus smart contracts’ but as part of a broader set of technologies forming the foundation of a more open internet stack.

However, Vitalik Buterin observes that the practical use of cryptocurrency for financial transactions in many countries often relies on centralized means, such as internal transfers on centralized exchange accounts or trading USDT on platforms like Tron.

Vitalik Blames Rising Transaction Fees for the Shift

Vitalik Buterin points to a significant culprit behind the observed shift — the surge in transaction fees. When the cost of interacting with the blockchain was minimal, ranging from $0.001 to $0.1, developers envisioned diverse applications using blockchain technology in both financial and non-financial realms. However, with transaction fees surpassing $100, Buterin highlights the increasing prominence of ‘degen gamblers’ – high-risk traders – as a dominant user group.

As degen gamblers become the primary users on a large scale, Buterin argues that this reshapes public perception and internal culture within the crypto space. He emphasizes that the rise in transaction fees has played a pivotal role in steering Web3 away from its decentralized ethos.