Ethereum co-founder Vitalik Buterin is urging cypherpunks to resist government and corporate encroachment, predicting that both seek more control and less trust. Buterin stresses that it is the work of the Ethereum developers and cypherpunk community to ensure user independence without being hostile to institutions.
According to Buterin, the relationship between cypherpunks and large corporations or governments is far from simple. He points out that governments and corporations are not always enemies of privacy tools and open systems, nor are they guaranteed allies. They usually support open systems in one area while pushing for control in another.
Buterin points to several recent examples, noting that the EU has signaled strong support for open-source software. At the same time, some EU officials push for Chat Control, requiring encrypted messaging to have backdoors. He also cited the U.S. Patriot Act, which he says remains in effect with little interest in repealing it from either Democrats or Republicans.
Buterin says institutions play both sides in the cypherpunk debate
According to the Ethereum co-founder, institutions play both sides of the cypherpunk debate, and this pattern reflects a basic mindset: control everything possible and resist control by others. However, he concludes that cypherpunks need not be hostile to institutions, though they should firmly defend their core interests.
For Ethereum users, Buterin believes that the core interest is building social, financial, and identity systems that protect user freedom and self-sovereignty. He calls Ethereum a censorship-resistant world computer, where no one has to approve of every activity running on it. In his view, building strong systems on top of Ethereum to compete both against CEXs and within blockchain ecosystems is what matters.
According to Buterin, institutions will favor self-custody and staking going forward, supporting Ethereum’s decentralization. He also noted that KYC and privacy technologies evolve in parallel with ongoing debates around zero-knowledge proofs. The Ethereum co-founder further stated that institutions are currently focusing on data security and sovereignty to maximize control and minimize reliance on external parties.
Stablecoins to sit at the center of the control war
Buterin says stablecoins will be one of the main battlefields between crypto privacy supporters and institutions. He emphasizes that governments and large corporations want digital currencies they can rely on, but also want strong control over risk, compliance, and rules.
Meanwhile, stablecoin issuers in the EU will prefer blockchains not dominated by U.S. governance, while U.S.-based issuers will prefer the opposite, according to Buterin. The political balance is expected to influence which chains institutions choose. At the same time, the Ethereum co-founder expects governments to push harder for KYC and monitoring of stablecoin use.
Buterin also projects that privacy around stablecoins will continue to improve, adding that user privacy protection tools will grow stronger and that non-KYC stablecoins are not likely to disappear. He points to ideas like zero-knowledge proofs of money sources, which could allow users to prove compliance without revealing everything. However, Buterin warns that these tools will trigger deep disagreements inside the crypto space.
According to Buterin, spreads on decentralized stablecoins can also decrease if it is easy for people to run arbitrage strategies where they hold positive quantities of a centralized stablecoin and negative quantities of the decentralized one. He also believes that traditional financial institutions should explore improving the liquidity of their stablecoins to use them for hedging existing risks.
On the other hand, the Ethereum executive notes that institutions want to retain full control over their own stablecoin wallets and infrastructure. He also explains that it is up to cypherpunks and Ethereum developers to ensure that regular users continue to have access to self-sovereign, secure ways to hold and use stablecoins.
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Source: https://www.cryptopolitan.com/ethereums-vitalik-buterin-urges-cypherpunks/
