The Fading Vision of Web3: Vitalik Buterin's Concerns on Rising Transaction Fees and Ideological Shift

ocated for the vision of Web3, which aims to create a more open and decentralized internet stack. However, in a recent blog post, Ethereum co-founder Vitalik Buterin expressed his concerns that this original vision has faded somewhat into the background. Buterin identified rising transaction fees as the primary reason for this shift away from Web3's ideals.

Transaction Fees and the Shift Away from Web3

According to Buterin, rising transaction fees have become a significant obstacle to achieving Web3's vision. He argued that these fees have excluded all but a niche community of "degen gamblers" from using blockchains, as they are the only audience willing to pay the soaring transaction fees. This domination of the blockchain user base by a niche community has led to negative outcomes and a shift in the public perception and internal culture of the crypto space.

Furthermore, Buterin pointed out that where people do use cryptocurrency for transactions or savings, they often do so through centralized means, such as exchange accounts or trading stablecoins like USDT on Tron. This reliance on centralized systems goes against the decentralized principles of Web3 and has further contributed to the fading of its original vision.

The Ideological Rift and Consumer Crypto Payments

Buterin also highlighted an ideological rift between the crypto world and non-blockchain advocates of decentralization. He stated that many non-blockchain advocates now view crypto as a distraction, and few talk about consumer crypto payments. This divide has hindered the progress of Web3's vision and further pushed it into the background.

Positive Developments and Solutions

Despite these challenges, Buterin emphasized that there have been positive developments in the past year. He mentioned scaling solutions like rollups, the ERC-4337 account abstraction standard, and light clients on Ethereum as notable advancements. Additionally, he discussed privacy solutions such as Railway and Nocturne and devoted a significant portion of the essay to zero knowledge proofs.

Zero knowledge proofs, according to Buterin, are a powerful tool that can provide privacy and various forms of authentication and verification simultaneously. He cited the example of Zupass, an in-person authentication system enabling anonymous voting and identification, as a use case for this technology.

In conclusion, Buterin's blog post sheds light on the challenges that have led to the fading of Web3's original vision. Rising transaction fees, the dominance of a niche community, and the ideological rift between the crypto world and non-blockchain advocates have all contributed to this shift. However, Buterin also highlights positive developments and solutions that provide hope for the future of Web3 and its goal of creating a more open and decentralized internet stack.