Now Is the Time to Build Beyond DeFi on Ethereum: Vitalik ButerinThe Ethereum co-founder is a fan of DeFi, but he wants the network to do more.
Ethereum has come a long way since it launched in 2015. The network has been behind some of the biggest crazes in the cryptocurrency industry, from ICOs to CryptoKitties to non-fungible tokens (NFTs) and decentralized finance (DeFi).
While ICOs in their original form have fallen by the wayside, the DeFi segment, in particular, has taken the financial industry by storm. DeFi gives users a way to generate passive income through activities such as lending and staking and bolster their returns.
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The total value locked (TVL) in DeFi currently hovers at USD 99 billion, according to DeFi Llama. The Ether price has benefited from the rise of DeFi, with the price soaring 657% over the past 12-month period.
DeFi and Beyond
Vitalik Buterin, the co-founder of Ethereum, believes that Ethereum’s use cases could go far beyond financial applications, according to his recent keynote speech at the Ethereum Community Conference 4 (EthCC) event in Paris. He pointed to DeFi protocols such as Compound, Aave and Uniswap, for example, that have all experienced great success. Vitalik is a fan of DeFi, though he is quick to point out:
‘But this isn’t all that Ethereum was trying to do.”
Source: YouTube/Grand Amphi Theatre
Vitalik admits that “price is nice,” but he is quick to add that it should “only ever come as a consequence of utility.” He wants the common denominator among Ethereum users to be utility, not just price.
The reasons why financial applications have thrived on Ethereum are two-pronged, according to Vitalik. First, centralized technology in finance is abysmal. And secondly, fees are so high, a problem that is being solved.
Considering that Ethereum is addressing fees and scalability with the emergence of sharding and Eth 2.0, he says that now’s the time to start building and go beyond financial applications.
NFTs R’ Us
NFTs, which are digital assets containing a component such as art, music, video, etc., are helping Vitalik’s cause by expanding Ethereum’s use cases beyond finance. These digital tokens have caught on like wildfire and have helped to attract outsiders to the cryptocurrency and blockchain space. Vitalik said,
“NFTs are interesting, they’re this interesting cultural phenomenon. And they really have attracted a different kind of people to the Ethereum space that are interested more in the art side than in the finance side.”
Vitalik wants to bring Ethereum further beyond DeFi. He defines the near-term goals as something that drums up enough support in the Ethereum community and “something that is useful for people to do.”