Vitalik Says Centralized USDC Could affect ETH Hard Forks in Future

Buterin argued that centralized stablecoins could be a ‘significant’ decider of which blockchain protocol the industry would ‘respect’ in hard forks.
Vitalik Says Centralized USDC Could affect ETH Hard Forks in Future

Vitalik Buterin, the co-founder of Ethereum said that centralized stablecoins such as USDT and USDC could become “a significant decider in future contentious hard forks.”

He made this comment while speaking at the BUIDL Asia conference in Seoul on Wednesday, along with Illia Polosukhin, the co-founder of Near Protocol.

Buterin argued that centralized stablecoins could be a ‘significant’ decider of which blockchain protocol the industry would ‘respect’ in hard forks.

“At the moment of the merge, you will have two [separate] networks […] and then you have exchanges, you have Oracle providers, you have stablecoin providers that are kind of deciding in a way, which one they respect.”

“Because at that point, you’ll have 100 billion of USDT on one chain and 100 billion of USDT on the other chain, cryptographically — and so, they [Tether] need to stop respecting one of them,” he explained.

He also said that this would not be an issue with Ethereum’s upcoming Merge, noting that this would be an issue further down the line.

According to him, Ethereum could see more contentious hard forks in the next five to ten years. Centralized stablecoin providers could carry more weight then.

Also Read: Vitalik Buterin Explains Steps In RoadMap of Ethereum Merge

He said that this could happen because of any number of reasons such as the Ethereum foundation would become weaker or the ETH2 client would have more power or ‘someone like Coinbase, would both run a stablecoin and have bought up one of the client teams by then…’

Vitalik also proposed opting for different stable coins to prevent giving too much power to one. 

He said, “The best answer I can come up with is to encourage the adoption of more kinds of stablecoins. Basically, you know, people could use USDC, but then they could also use DAI and like, at this point, I mean, like DAI has taken this kind of very decisive route of saying ‘we’re not going to be purely crypto economic we’re going to be a wrapper for a whole bunch of real world assets.’”

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