According to Odaily, a recent report by the European Union delves into the potential of permissionless blockchains within traditional finance (TradFi). The report suggests that permissionless blockchains should at least be considered as an option for traditional finance and financial market infrastructure, albeit with cautious adoption. It argues that such blockchains can be more neutral than private blockchains, thereby fostering competition. The unrestricted access provided by public blockchains contrasts sharply with the growing number of isolated permissioned blockchains. While public blockchains have their drawbacks, the report notes that there are numerous well-known solutions to address these challenges, particularly by adding permissions at the smart contract level.
The report highlights that permissionless blockchains can offer an interoperability layer for Layer 2 blockchains, including regulated ones. When smart contracts are located on a single chain, they can be combined to form more complex functionalities. However, the report also acknowledges the disadvantages of public blockchains, such as scalability, privacy, finality, and governance. It provides an in-depth analysis of each of these topics, as well as the contentious issue of Miner Extractable Value (MEV).