Vitalik Buterin, co-founder of Ethereum, spoke at the Toronto Star making some interesting statements about fees, adoption and scalability of the blockchain.
Buterin confirmed that the Ethereum blockchain is overloaded. A large organisation that intends to build on Ethereum would further overload the blockchain and would also increase the cost of transactions.
The network is now at its limit and this hinders the adoption on a large scale. The only way to improve this situation, according to Buterin, is Proof of Stake.
For Buterin, the big problem today is that every computer has to verify every transaction. It is necessary to move to a network where each computer verifies on average a certain number of transactions, a small part of the total. This would sacrifice a small part of the overall security but would reduce costs by a factor of 100.
Ethereum’s fees are currently decreasing and register the lowest value of the last 50 days with an average of 0.11 ether per transaction.
Buterin believes that scalability is not the only problem. Other challenges include usability, privacy and account security. From a security point of view, for example, attempts are being made to make life difficult for cybercriminals by using multiple keys to access wallets.
The role of governments
The price of Ether is another key factor that generates uncertainty but this is in no way controllable by the Ethereum Foundation. Buterin believes that governments have a key role to play.
“Governments do have a role and one of the roles is regulation. The usual concerns are about cryptocurrency exchanges where the basic idea is to do fundraising for a new project by directly selling tokens on the blockchains. There are debates whether specific kinds of ICOs [initial coin offerings] are legally categorized as securities”.
Blockchain is not just bitcoin
Another noteworthy part of the interview sees Buterin talking about the potential of the blockchain that people too often confuse with Bitcoin.
“One of the big things that needs to be communicated is the fact that five years ago the blockchain was just about bitcoin, but now it’s much bigger than just bitcoin. It’s split off into separate spaces that have a lot of different visions. For bitcoin, the idea is that you have decentralized cryptocurrency running on blockchain and protected from corporate and state control that’s not going to deflate on you and it’s not going to get confiscated. The blockchain is just a tool to make that specific thing possible”.