Ethereum: Vitalik Buterin sees “Google moment” coming
- Ethereum could soon experience its “Google moment,” founder Vitalik Buterin writes in a blog post.
- In it, he explains that so-called low-risk DeFi applications have the potential to become for Ethereum what search is for Google – a permanent and stable source of income.
- Buterin defines low-risk DeFi primarily as payment and savings applications, but also synthetic assets and fully collateralized lending, i.e. areas that, in contrast to speculative projects such as memecoins or risky liquidity mining programs, focus on solid and sustainable use.
- The applications would also have to be technically secure, globally usable, and accepted by the community in order to generate a sustainable adoption movement.
- Historically, DeFi has been heavily characterized by speculation and high, short-term returns. Buterin says that risks in the protocols have now decreased, security has increased, and a stable core of applications has emerged that is proving robust.
- Low-risk DeFi is also ethically congruent with the goals of the Ethereum community, as it enables global, permissionless access to meaningful financial services – and thus also reaches people in regions where traditional banks have failed.
- Buterin explains the comparison to Google as follows: The digital giant also develops many products that are culturally important but economically irrelevant. However, search remains the key revenue driver. Low-risk DeFi could play a similar role for Ethereum – the only difference being that, unlike advertising, it doesn't create problematic incentive structures, but rather represents a “positive-sum” financial model.
- During the current bull run, Ethereum was long considered a “problem child,” not least because a significant portion of its revenue flowed from the mainnet due to the heavy use of Layer 2 networks like Arbitrum and Optimism. However, its low-risk DeFi approach could potentially make Ethereum a dominant revenue source, which should ultimately also have a positive impact on its price in the long term.
- You can read about Ethereum's short-term prospects here: Ethereum price forecast: Rocky road to all-time high
And anyone who wants to benefit from Ethereum's developments in a timely manner can do so on Bitpanda – Europe's largest crypto exchange. Fast, secure, and affordable.
Recommended Video: What's happening now with Bitcoin & Altcoins – Fed decision today!
Sources
- Blog post on low-risk DeFi
