Ethereum co-founder Vitalik Buterin has spoken out in the wake of the FTX collapse, offering his thoughts and some positives from one of crypto’s biggest black swan events.
In a Nov. 20 Bloomberg interview, Buterin said that the collapse of FTX contains lessons for the entire crypto ecosystem.
He acknowledged that the underlying stability of distributed ledger and the technology powering the crypto asset economy has not come into question. The problem in this instance (and several before it) has been people, not technology.
Buterin also labeled the FTX collapse as a “huge tragedy” but added that it reaffirms the position of many in the Ethereum community concerning centralization:
“That said, many in the Ethereum community also see the situation as a validation of things they believed in all along: centralized anything is by default suspect.”
He added that this ethos includes trusting in open and transparent code above humans. Over the weekend, Buterin posted a guide to having a “safe CEX” with proof of insolvency.
He said rather than relying solely on “fiat methods” such as government licenses, auditors, corporate governance, and background investigations of people running exchanges, the exchanges could create “cryptographic proofs that show that the funds they hold on-chain are enough to cover their liabilities to their…
