Vitalik Buterin does not like BlackRock becoming a major shareholder of ETH: Ethereum will face two major destructive risks.

Vitalik Buterin, co-founder of Ethereum, warned at yesterday's Devconnect that if Wall Street giants like BlackRock continue to expand their control over ETH, Ethereum may face two threats: not only will it chase away the core community that truly values decentralization, but it may also adopt the wrong underlying technology path due to institutional influence, turning Ethereum into a “Wall Street exclusive chain” and losing its most precious qualities of permissionlessness and resistance to censorship.

Is it a good thing that Wall Street is going crazy buying ETH? Vitalik interprets the underlying crisis.

After BlackRock launched the Ethereum spot ETF, institutions flooded into ETH, providing Ethereum with unprecedented financial support and mainstream recognition.

According to the data, there are currently nine ETF issuers holding over 19.1 billion USD in ETH, and the reserve company (DAT) also has approximately 19 billion USD on its books, totaling about 12.6 million ETH, accounting for 10.4% of the current total supply.

However, for Vitalik, this kind of success of being “seen by the world” may be an invisible and dangerous path towards centralization.

He stated at the Devconnect conference that institutional funding brings not only resources but also pressure to change the direction of the protocol, and this is precisely the trap that Ethereum must avoid.

( Ethereum Foundation has launched a new dedicated website for organizations, creating a platform for corporate blockchain guidance )

Threat 1: The Ethereum community and developers may leave one after another.

Vitalik first emphasized that as long as large institutions hold too much influence, it will alienate developers and builders who are deeply committed to the ideals of Decentralization.

He described that many of those who participated in the early construction of Ethereum joined because they believed in an open, fair, and permissionless network; however, if Ethereum gradually becomes an institution-led, compliance-oriented infrastructure, this group of true pillars may be forced out one by one:

Ethereum may lose its most important assets, which are the technical talents and guardians of ideas that have been invested in for many years.

He is concerned that once the core strength of the community dissipates, the spirit of decentralization of the agreement will also disappear.

Threat 2: Ethereum may become the “Wall Street exclusive” Ethereum

The second crisis is more specific: institutional pressure may force Ethereum to make “technological choices that are unfriendly to general users.”

Vitalik cited that financial institutions might prefer a super-fast block time of 150 milliseconds, making high-frequency trading (HFT) more efficient, but this would lead to serious consequences, as contributors and non-professional nodes would have almost no way to participate in such a low-latency network.

He bluntly stated that if Ethereum adopts such parameters, only those living in financial centers like New York or London, and who own expensive data centers, would be able to successfully run a node:

An Ethereum that is continuously optimized by Wall Street will ultimately become an Ethereum that only Wall Street can use.

For a leader of a group that opposes authoritarianism, this certainly directly contradicts the core spirit of decentralization.

(Vitalik looks at Ethereum reserve companies: It is a good thing for more people to own ETH, but don't play leverage games)

What should Ethereum hold on to? Vitalik: It’s not speed, but freedom.

In the face of the growing influence of institutions, Vitalik's answer at the meeting was clear and direct:

We must focus on those things that will become scarce in the future: global, permissionless, and censorship-resistant.

He emphasized that Wall Street does not need Ethereum to enhance trading speed or settlement efficiency, as the traditional financial world already possesses these advantages. The truly invaluable value of Ethereum that is difficult to replace is that it provides a global agreement that allows for free participation without relying on governments, corporations, or intermediaries.

To maintain this value, it is necessary to rely on a core community with firm beliefs, rather than gradually handing over the direction of the protocol to institutions.

Ethereum in the Next Ten Years: How to Retain Ideals and Community?

Ethereum now stands at a crossroads, with one side being the capital and mainstream brought by Wall Street, and the other side being the core spirit of decentralization that underpins Ethereum.

Vitalik's warning points to the harshest reality: “If Ethereum changes its essence to cater to institutions, it may eventually lose the reason to attract the entire world.”

Therefore, the real challenge may not be to reject institutions, but rather to ensure that their involvement does not consume the soul of the protocol.

This article discusses Vitalik Buterin's dislike of BlackRock becoming a major shareholder of ETH: Ethereum will face two catastrophic risks. It first appeared on Chain News ABMedia.