Ethereum is more than DeFi for farmers – Vitalik Buterin


Ethereum co-founder Vitalik Buterin said the network needs to go beyond DeFi and asked the community to help the ecosystem grow

Speaking at the EthCC conference in Paris, Ethereum’s lead developer emphasized that the ecosystem needs to grow and innovate beyond the decentralized finance (DeFi) industry. Buterin told how he sees the future of the ecosystem, and added that, in his understanding, it “has always gone beyond the financial segment.”

Financial apps are now dominating the web, he said. In doing so, he also pointed out the obvious shortcomings of a centralized banking system, such as high fees and low transaction processing speed.

“A decentralized space is very different from a centralized financial system.”

Ethereum evolution

Commenting on the high transaction fees, Vitalik noted that this is normal for DeFi farmers, but not for the average user.

He cited the example of decentralized social media, where every tweet becomes a non-fungible token (NFT), adding that nothing would work if you had to pay $ 5.22 for each transaction.

At the time of this writing, transactions on the ETH network cost users $ 3.79. However, back in May, you had to pay more than $ 70 for them.

Average cost of transactions on the Ethereum network. Source ycharts.com

Now this problem is being solved with the help of roll-ups and second-level solutions. Sharding will further increase the scalability of the network.

Buterin also added that holders of DeFi tokens are fixated on price, although the main goal of all these projects is not price speculation, but practical benefits.

“The price is good, but it should be determined solely by the benefit.”

The creator of the second largest cryptocurrency stands for an ecosystem that benefits. According to him, DeFi is better than nothing, but you need to move on.

DeFi Funds Blocked

Vitalik describes DeFi as a narrow area of ​​application, but this industry is growing at a phenomenal rate. The amount of funds blocked in DeFi-protocols, according to DappRadar, reached $ 84 billion.

Read also: Crypto Market Ready for Recovery: Money Flowed Again to DeFi Protocols

Since the beginning of the year, the indicator has grown by 278%, and over the past 12 months, the increase has amounted to 1800%. The industry peaked in May 2021 with over $ 140 billion in blocked funds.

Meanwhile, Ethereum grew by 7% over the day and returned to the area above $ 2000.

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Karice Dabule

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