Cryptocurrencies need time to mature, according to blockchain co-founder Vitalik Buterin.
“It is better to have regulations to ensure the internal independence of cryptocurrencies, even if this prevents their mass adoption. In fact, I feel a bit relieved that the introduction of many ETFs is being delayed. The ecosystem needs time to mature before being subjected to the torment of regulators.”
The Ethereum co-founder believes that the use of the “know your customer” (KYC) principle in decentralized finance (DeFi) is a problem.
“KYC in DeFi interfaces will annoy users, but it won’t do anything against hackers. Hackers have already learned how to write their own code to interact with smart contracts,” Buterin warned.
He believes that an effective way to comply with regulations while maintaining user privacy is to use zero-knowledge evidence: ‘Rules should be written in such a way that requirements can be met as much as possible with zero-knowledge proofs’.
Here’s an explainer video on Zero-Knowledge Proofs you might find useful.
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