Vitalik Buterin made new important statements about Ethereum’s future

Ethereum co-founder Vitalik Buterin attended the Mainnet 2022 conference. There, he made some critical statements about Ethereum’s future. We selected the most important points from his speech below.

Key takeaways

The recent Ethereum hardfork (The Merge) converted the validation algorithm of the largest altcoin, opening up new horizons for the ecosystem. It is the most significant change in Ethereum’s current history, but the project’s plans do not stop there.

Speaking at the Mainnet 2022 conference, Vitalik Buterin made several essential statements regarding Ethereum’s future. Here are the main theses of his speech:

• Proof-of-Stake algorithm (PoS) is the future of cryptocurrency. According to Vitalik, with Proof-of-Work (PoW), it is impossible to solve scaling problems, implement smart contracts and decentralize the network. There is difficulty in calculating the hash, and it requires a lot of energy and resources. Vitalik also cited the example of Zcash and Dogecoin, which in his opinion, will soon switch to PoS (these projects have previously announced preparations for such a transition).
• As the next big goal for the project, Buterin promised users to solve the Ethereum blockchain scalability problem. To be more concrete, he gave a deadline for the project to complete this problem — 18 months from now (by mid-2025). This network transformation will happen gradually, and this stage is codenamed The Surge.
• The Ethereum founder also said that no solutions to increase the anonymity of ETH transactions and tokens are planned for five years. Vitalik made it clear that he has a negative attitude towards anonymity in crypto.
• He argued this attitude with the painful experience of Monero and DASH, which dropped out of the top 25 capitalization ranking (in which they remained for most of the cryptocurrencies’ existence). One of the reasons for the drop in popularity of these particular coins is that most exchanges, under pressure from regulators, have removed these coins from their listings.

Opinion of Opponents

The last point in Vitalik’s speech caused polemics in the community. Vitalik’s logic is clear — he wants to sacrifice the most important property of cryptocurrencies — their anonymity, in exchange for more security and predictability in relations with regulators and authorities.

Nevertheless, such a position was met with confusion and criticism from the community, as it completely contradicts crypto ideals.

Thus, the leading Ethereum developer Tim Beko publicly said that the current #1 problem in Ethereum is the lack of confidential transactions. And contrary to Vitalik Buterin’s opinion, he calls to solve this problem first.

Independent analysts have already started thinking about ways to achieve this, and have even turned to the founder of Zcash for advice.

Our Synopsis of the Anonymity Problem

We should remember that when moving to PoS, according to some experts, Ethereum lowered its level of security and anonymity. In addition to the increase in centralization, the anonymity of transfers has also suffered. Сurrently, Ethereum validators are not anonymous, and it is easy to map validator IDs to the physical IP addresses of a node.

Monero and Dash, cited by Vitalik as an example, have built-in mechanisms to anonymize transfers, making mixers and any third-party privacy protection mechanisms unnecessary.

In early 2022, Litecoin successfully integrated the MimbleWimble mechanism, a robust privacy protection technology. Binance then delisted the coin, and several other exchanges did the same. Interestingly, Bitcoin also plans to integrate MimbleWimble around 2024.