Vitalik Buterin says that blockchain applications outside of finance face more difficulty gaining traction.
Ethereum (ETH) co-founder Vitalik Buterin says that blockchain applications outside of finance face more difficulty gaining traction, as the primary added value they offer is decentralization. Buterin made his remarks during a speech at crypto event Token 2049 in Hong Kong on March 13.
Buterin began by noting that finance is “realistically the first blockchain [application] that will probably achieve wide scale adoption,” and that even though he is a self-declared huge fan of other applications:
“The problem is that decentralization is basically their value add. With finance you’re competing with banks that take five days to do something interesting. With anything that’s not financial, chances are there is some internet thing that does what you want, that’s just centralized. So it’s a bit of a harder pitch.”
As examples of areas where blockchain can catch on beyond finance, Vitalik isolated digital identity, reputation and digital certificates in particular — all of which have use cases that are not necessarily confined to the use of cryptocurrencies or financial markets.
In his further discussion on the current state of blockchain adoption, Buterin appealed to event attendees to identify real-world applications that are developing “not just in theory, but on the ground.” Audience examples included micro-insurance, non-fungible tokens and gaming.
On the latter, Buterin said that while many people are committed to blockchain innovation from their conviction that it can tackle real-world problems with positive social impact, entertainment use cases such as gaming are valuable areas where the technology can draw high numbers of early adopters.
Speaking of his personal commitments, Buterin highlighted decentralized applications (DApps), which allow multiple actors to share and cooperate on applications that are based on an underlying, decentralized blockchain protocol.
He proposed that the DApps use case can potentially redraw the existing technology and power landscape by leveraging a decentralized ecosystem to allow smaller players to compete with tech giants’ monopolies.
In a recent interview, Buterin stated he was trying to solve Bitcoin’s (BTC) limited functionality with the creation of Ethereum. He compared Bitcoin’s ability to do one thing and do it well, with the aspiration to make Ethereum more like a canopy for apps that can do almost anything.