At the TOKEN2049 conference in 2024, Ethereum co-founder Vitalik Buterin delivered a keynote speech titled What Excites Me About the Next Decade as a guest speaker. Vitalik expressed his thoughts on a number of issues including user experience, transaction fees, privacy protocols, etc., and stated that the crypto industry has moved from the early stages to the early stages of real usability. Vitalik also stated that the crypto industry needs to continue to advance technological progress and serve the entire society while maintaining the core value of decentralization.
The following content is compiled by Liande based on the content of the on-site speech:
The cryptocurrency industry has passed its early stages and entered the early stages of crypto applications.
Starting in 2013, we were all excited about Bitcoin, believing it to be the next big revolution in payments, and we were all trying to get merchants around the world to start accepting Bitcoin. When I went to Argentina in 2021, which was also my first time there, I noticed that the locals were not only very excited about cryptocurrency, but were also actively using it on a large scale.
But Argentinians are still using the traditional financial system to transfer money, and I think that's because the traditional financial system's transfers are instant and free, and I think this ultimately killed the initial wave of exploration to get everyone to adopt Bitcoin as a currency. The reasons why crypto consumer payments have failed for so many years are transaction fees and various other user experience issues, but in fact it is mainly because of the cost issue.
Ethereum absolutely supports privacy-preserving transactions. But the rise in Gas is uncontrollable. But in 2024, Ethereum is ready. Improved user experience is one of the key factors in promoting the mainstreaming of cryptocurrency.
Transaction fees have dropped significantly, and transaction confirmation time has dropped to about 10 seconds on the Ethereum mainnet, with fast confirmation even below 1 second. Other improvements include significant improvements in user experience, account abstraction, ZK-SNARK mainstreaming, L2 usability, etc. Past technical limitations are no longer limiting factors.
Fee chart about something weird going on with Ethereum. Fees have dropped from between $10 and 50 cents to less than a cent, basically close to zero. Meanwhile, Optimism and Arbitrum, two major Ethereum Layer 2s, have reached a milestone called Phase 1, and multiple ZK-based Rollups have told me that they plan to reach Phase 1 soon. So Rollups will soon become more secure, too.
In the past, a large block would appear in 10 minutes. It might even take an hour to confirm a transaction on Ethereum. After EIP 1559 was put on the chain, with the introduction of technologies such as EIP-1559, Layer 2, and account abstraction, in theory, the block time is 13 seconds, but due to the very low efficiency in the past, sometimes you have to wait for a completely random time. When using Layer 2, it can even be shortened to 1 second.
This change makes decentralized technology more affordable for real-world applications, paving the way for mass adoption.
This year, with the mainstream application of EIP-7702 and ZK-snarks, various applications are being used by more and more people. We can prove that under zero-knowledge, today's DApps are not only more functional, but also close to the level of Web 2.0 in terms of interface quality. Through these improvements, cryptocurrency is gradually moving from the geek circle to a wider range of mass users.
As the industry continues to advance in technology while maintaining the value of decentralized open source code, the future crypto world should be able to provide practical and secure services to the general public.
Encryption technology does not equal efficiency
We think that a mistake people sometimes make is to view cryptocurrency as an efficiency technology. Encryption is not a technology about "efficiency". Encryption is digital concrete. Blockchain has the same origin as cypherpunk technologies such as mixnet, Tor, and BitTorrent, but blockchain is also different. Blockchain creates an extremely stable and lasting structure, which enables the Internet to not only bypass the weak links in the old structure, but also actually build better alternatives. This digital concrete is to establish a more solid foundation for the digital version of the city in the sky. It can be a solid fortress for people to protect their families, and it can also be a place for friends to have fun. This is also the ideal form of encryption in my eyes, which is both serious and interesting.
(When talking about this, Vitalik also sang a song "Castle in the Sky" on the spot)
A lot of people were talking about this 10 years ago. I think it's important to remember that the benefits that encryption has brought to the world have nothing to do with the same kind of technological improvements. Because going from a regular jet to a supersonic jet is a technological improvement. It's a different type of technology.
If you think about how blockchains are different from previous technologies, some of the technologies they are based on are sensational stuff, and I think you'll realize that blockchains are all about creating lasting structures, and those structures are very powerful.
A castle can be a museum that preserves a thousand years of history of the whole of Europe. A digital castle can be all of these things as well, digital and all types of digital castles are things that we can build on top of this area.
Ethereum's Vision: Mainstream Adoption + Open Source + Decentralization
What should our team goal be? We need to meet the needs of mainstream adoption, and at the same time we need to adhere to open source and decentralized values.
Privacy protocols have great market potential in the crypto world. In particular, the application of zero-knowledge proof (ZK-snarks) technology allows users to complete transactions without revealing their personal identity, thereby achieving a balance between privacy protection and compliance needs.
Not only can users maintain a high degree of privacy, but they can also meet regulators' requirements for transparency. This dual-demand solution will help cryptocurrencies better enter the mainstream financial market.
We have a new, better privacy protocol. It’s a way for average users to have a very high degree of privacy while meeting many important compliance requirements, but with virtually no backdoors.
Let's take the example of wallet security. Historically, there have been basically two ways to keep your money. One is you go like crazy self-sovereign and write down your mnemonic phrase yourself and do everything offline. Carve your phrase into a piece of titanium that can't be damaged, put the titanium into a lockbox made of it, but put that box 10 meters underground, and then your crypto is permanently safe. The other way is, take your crypto and go give it to some trusted person.
If you want to protect yourself from centralized actors, then you can do traditional self-custody. What if you want to protect yourself from centralized exchanges? What if you want to have both? That requires a smart wallet with multi-protection. What we do with multi-protection means that you have multiple keys.
Multi-signature smart wallets are a key tool for future crypto asset management. They allow users to disperse keys among multiple devices, friends or third parties, thereby improving the security of funds. Traditional cryptocurrency storage methods are either extreme self-sovereign methods (such as engraving private keys on metal plates and hiding them underground) or rely on centralized trust institutions. Multi-signature wallets can improve user experience while maintaining decentralization.
For example, you might have six keys, four of which are needed to send transactions, and then you make a rule that applies to all transactions. When we need a key, it can be any combination of keys that control existing services for friends and family.
You actually get the benefits of institutional trust as well, like in decentralized social media where you can set up your recovery addresses and have as much control over your account as your multisig. I personally trust my multisig far more than any of my centralized accounts.
This is where a multi-signature smart wallet comes in. Multi-signature means that you have multiple keys, for example you might have 6 keys and you need 4 to send a transaction. You can even set a rule that only one key is needed for small transactions. These keys can be any combination that you control.
Wallets can not only be used for daily management of cryptocurrencies, but also achieve higher security by adding multi-layer trust mechanisms (such as email verification, government ID, etc.), avoiding the risks brought by complete reliance on centralized exchanges.
Blueprint for the future
The future of cryptocurrency technology needs to strike a balance between decentralization and practicality. Excessive pursuit of decentralization may lead to the sacrifice of user experience and failure to attract mainstream users; while completely sacrificing decentralization will lose the core value of cryptocurrency. In the future development of the industry, it is necessary to maintain the technical advantages of decentralization while ensuring the availability and ease of use of the system.
This is also our vision for the future development of cryptocurrency:
Through continuous innovation and improvement of technology, it can not only meet users' needs for security, privacy and decentralization, but also attract more mainstream users to participate and promote the large-scale adoption of cryptocurrencies.
We need to meet the demands of mainstream adoption while maintaining the values of open source and decentralization. We don’t need to make a trade-off between decentralization and practicality. In the future we can have both.
