Vitalik Voices Concerns

Ethereum founder Vitalik Buterin weighed in on the progress of regulation in the cryptocurrency industry yesterday, taking to Twitter to speak out against regulatory policies that inhibit a crypto ecosystem’s ability to run itself.

• Vitalik said, “there’s two main classes of regulatory policy goals: (i) consumer protection, (ii) making harder for baddies to move large amounts of money around”
• He went on to comment that in current conditions, it was actually better that ETF applications are being delayed, saying that “The ecosystem needs time to mature before we get even more attention.”
• Buterin also commented on the presence of the Know Your Customer (KYC) verification process in the DeFi space, highlighting that it “would annoy users but do nothing against hackers.“

Though Vitalik’s point may not be the most popular, any negative publicity that would come from a hastily approved ETF could do more damage than good.

He also recommended using zero-knowledge proofs to preserve privacy while complying with regulatory requirements, advocating that regulation be “written in such a way that requirements can be satisfied by zero knowledge proofs as much as possible.”

If cryptocurrency is to be successful, regulation is inevitable. The reputation it develops until getting there is constantly scrutinized.