On December 1, PANews reported, according to Ledger Insights, that the EU has released a report exploring the potential of permissionless blockchains in traditional finance (TradFi). The report suggests that permissionless blockchains should at least be considered as an option for traditional finance and financial market infrastructure. However, their adoption should be approached with caution.
Author Fabian Schär believes that permissionless blockchains are more neutral than private blockchains, thus encouraging competition. The unrestricted access achieved by public blockchains stands in stark contrast to the increasingly isolated permissioned blockchains. While there are drawbacks to public blockchains, there are many well-known solutions that can address their challenges, particularly by adding permissions at the smart contract level.
The EU report does not cover up the shortcomings of public blockchains, such as scalability, privacy, finality, and governance. It delves deeply into each topic, as well as the controversial maximum extractable value (MEV) issue, where block proposers sometimes reorder transactions at the expense of blockchain users' interests, which is a form of front-running.