Vitalik Buterin Talks Ethereum 2.0, Silicon Valley and Eternal Life with Bitpush News

The founder of Ethereum Vitalik Buterin is known for his blockchain network designed for running smart contracts and applications. Already running on the network are apps for playing games, betting on exchanges, streaming music and more.

Buterin has thoughts on scaling the network, the launch of Ethereum 2.0 and about what direction the future is heading in and he discussed them all with Bitpush News in a recent interview.

The hallmark of the Ethereum 2.0 upgrade is the transition from a proof-of-work network to proof-of-stake. While initially planned for release in January, 2020, the project has been delayed several times and currently stands without a solid launch date. Buterin has said that the project is taking longer than expected, but is still satisfied with progress so far.

Buterin is especially excited by the launch of Altona, which developers say could be the first public Ethereum 2.0 test network. But for now, it is still a developer network testing for critical errors. Buterin says the Altona network already has four different clients running on it. While Buterin is hopeful when it comes to Ethereum 2.0’s success, he still spies hurdles with the transition to a proof-of-stake network.

“One of the misconceptions people have is they see proof-of-stake as a government mechanism, a kind of voting that the stakers control the network,” Buterin said. “I don’t think that is really true. Miners or stakers keep the network running, they defend it, but they don’t actually have that much power over making decisions. The phrase I used to say is ‘the miners or stakers are military, not government.’”

As an example of his phrase, Buterin described how miners have control over things like the gas limit — as illustrated by the recent increase from ten million to twelve million — but generally miners do not have lots of power.

He highlighted that while the philosophy behind what secures the blockchain has changed with the switch to proof-of-stake, it isn’t a surprising transition for Ethereum.

“POW (proof-of-work) and POS (proof-of-stake) have different philosophies,” Buterin said. “It’s the change that most people in the ETH community are expecting from day one. Even at the beginning of 2014 we started talking about POS and how we intend to switch to POS at some point in the future. POS gives you the same level of security but a higher level of efficiency.”

Buterin is working to tackle the Ethereum network’s scalability limitations so that more apps can get up and running using the blockchain. He is hopeful that mass adoption is well on its way, especially as more Wall Street players including Grayscale, Fidelity and J.P. Morgan join the crypto community.

“I do expect the scalability needs to be solved soon,” Buterin said. “Existing institutions definitely move slowly, but general people will adopt it very quickly.”

The general population is already warming up to the crypto world which seemed distant and confusing only five years ago. When Goldman Sachs released a report in June arguing that cryptocurrencies are not an asset class, the bank faced harsh criticism both from every day traders on twitter and from other traditional finance leaders.

The biggest argument against cryptocurrencies still seems to be that crypto coins have no intrinsic value. Buterin agreed that right now cryptocurrencies virtual nature means that they only have value because people believe in their value, but added that as blockchain becomes more widely used and adopted the currencies are going to have more solid value grounds.

“In the long term I think the system is valuable because it is useful to people, for example, Bitcoin is useful for people to store, transfer money,” Buterin said. “In the Ethereum case, the question is actually easier. First of all, Ether can be valuable for the same reason as Bitcoin is valuable. Second, the Ethereum blockchain is useful for a lot of different things, it’s useful for building many kinds of applications, there is a lot of value you can get from just sending transactions on the Ethereum blockchain.”

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The Ethereum blockchain is currently being used to build applications to be used across finance, health, agricultural, and even education industries. As these use cases become more common the value of the blockchain’s token, ETH, will only increase.

In the financial world  — where the technology is most popular today - Buterin believes the rise of DeFi will come from blockchain projects making simple tasks simpler. Things like making payments, sending money, or investing could become vastly more efficient on a blockchain-based system using Stablecoins.

“The thing that I am most excited about over the next five years is not many people creating applications, but just taking the existing things and continuing to make it much better,” Buterin said. “Regular e-commerce websites could start to accept stablecoins, could even start processing refunds with Stablecoins. For those things to continue to get easier and to work more efficiently, at much more scale in five years than where it is today.”

When it comes to valuing blockchain, the calculation can be tricky, but Buterin doesn’t think this is unique to Ethereum. He compared blockchain companies to social media sites like Facebook, Twitter or Tencent which tied not to physical products, but instead to services.

“The fact of value does not correspond to anything physical,” Buterin said. “It’s about services, information and all this kind of things. It’s all these things that cause challenges. Cryptocurrency is completely virtual, all they do is provide services and that’s being able to use blockchain and cryptocurrency, but the rest of the economy is also moving in the same direction.”

Buterin sees a clear divide between the world of blockchain and the long-regarded mecca of tech which brought the world companies like Facebook and Google.

“Silicon Valley companies are more centralized. The kinds of things you have to do to create a successful company is different for that reason,” Buterin said. “You have to have a good idea about products, be able to run the organization which contains a lot of people, you have to be a general of a good army, give people orders, quickly change strategies, all things like these. Blockchain is different, the success of blockchain depends less on the company, more on community.”

As for being a leader in the blockchain world, Buterin argues that it’s less about commanding people and more about understanding patterns and inspiring the community to continue innovating.

“I think in the next tech revolution, Silicon Valley will only be  a small part of it,” Buterin said. “A lot of ideas, culture that started in Silicon Valley can still help people be successful and will continue to survive, but those ideas and culture will separate from Silicon Valley the place. The tech revolution will happen not at one single place, but it will happen in a more distributed, decentralized way.”

Buterin also argued that what distinguishes Ethereum from companies like Facebook is its decentralized, trustless system.

“You don’t even have to trust people behind it. You just need to trust the algorithm, the code, everything is open source. You basically have to just trust the Ethereum system works,” Buterin said. “For example, the gas limit change a few days ago, I was not involved in that decision at all. It was Ethereum miners, even with the decision around how the protocol changing, it doesn’t have much to do with myself.”

Beyond blockchain, Buterin is excited about the future of technology. He predicted in a recent tweet that in the coming years attention will shift to biotech and working to expand the human lifespan. Since a young age, the blockchain innovator has been gearing up for an expanded life and he doesn’t see why people wouldn’t want to enjoy life longer.

“I think we can keep having new lives. I think resources are not that limited. Every new person added to the world, on the one hand, they could consume some resources, but on the other hand, they could be that person who creates some new invention to make resources consumed more efficiently,” Buterin said. “So in general, take all together I think we will bring it better, if the earth gets completely out of resources, we can live in other star systems. I think humanity has a lot of space to expand.”

Buterin also defended what he perceives as declining faith in technology as a good invention. He cited science fiction in the U.S. depicting technology as the thing that will cause society’s downfall. Shows like Black Mirror which show dystopian worlds ushered in by technological revolutions in Buterin’s mind reflect a growing disdain to technological innovation. But, he sees the coronavirus pandemic as an opportunity to remind Americans of the immense power of the tech industry.

“We should prevent the virus by working hard to understand the diseases, research what things spread or don’t spread the virus, find what things we should do, or don’t,” Buterin said. “The cure for the virus is technological progress. For solving aging, it’s exactly the same situation, tech progress is good, basically, it is the only thing that can save us.”

By Susan Feng, Mary Liu and Emily Mason

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