The days of 1,000-fold growth in cryptocurrencies like Ethereum and bitcoin are over, according to Ethereum Co-Founder Vitalik Buterin. In an interview with Bloomberg, Buterin said the days of explosive growth in the blockchain industry are numbered. More people are aware of the technology now than ever before.
“The blockchain space is getting to the point where there’s a ceiling in sight. If you talk to the average educated person at this point, they probably have heard of blockchain at least once. There isn’t an opportunity for yet another 1,000-times growth in anything in the space anymore.”
In the earlier years, growth in cryptocurrencies like bitcoin and Ethereum was dependent on marketing efforts to create wider adoption. “That strategy is getting close to hitting a dead end,” Buterin said.
The next phase of growth must involve people who are already interested in blockchain engaging in a deeper way. Meanwhile, he believes the infrastructure surrounding decentralized systems, dApps and protocols must be improved upon to encourage consumers to actually use the blockchain. The industry should “go from just people being interested to real applications of real economic activity,” Buterin said.
Hurdles to Adoption
There are a few hurdles to greater adoption, however, as Buterin pointed out in a tweet.
For example, dApps such as Peepeth, a decentralized alternative to Twitter, require users to send ether when information must be sent to the Ethereum network.
At the protocol level, Ethereum’s open-source developer community is feverishly working on the implementation of Sharding and Plasma, two solutions designed to massively increase the network’s scalability and deliver 1 million transactions per second. Sharding is expected to be implemented by 2020.
In addition, dApps generally need to become more user-friendly, especially if they target the customer base of widely used centralized platforms such as Twitter or Facebook.
Buterin is more interested in long-term growth and real use of blockchain systems versus short-term growth. The latter of which attracts the highest number of price speculators, which is clearly detrimental to the industry.
He also weighed in on institutional products like ETFs, concluding:
“I honestly don’t think this stuff matters much. There’s honestly a part of me that would be happier if institutional trading of cryptocurrencies did not happen at all for another five years. Ultimately if all that cryptocurrency is, is this thing that millionaires keep buying and selling to each other, then what have we really accomplished?”
The ETH price continues to persist below the psychologically important $300 level.