Vitalik Buterin believes that only adoption can lead to progress. Do today’s Ethereum based systems have true autonomy, or are they just decentralized but centralised?
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- Vitalik Buterin questioned whether Ethereum is still serving its original goal, which was to empower users through decentralization.
- Decentralization is not the default for many applications, which are still controlled by admin keys and centralized interfaces.
- Most Layer-2s (dApps), DAOs and dApps are still failing basic decentralization tests, as shown by benchmarks such as the Insider Attack and Walk-Away Benchmarks.
- Privacy, exit rights and governance fairness are weak throughout the stack. A growing reliance is placed on trusted intermediaries, off-chain technology and other infrastructure.
- Experts concur that Ethereum’s second phase will focus not on adoption metrics but rather on the enforceable freedom of users, as opposed to just technical innovation or adoption metrics.
Ethereum’s mission core still requires defending
EthereumETH) turns ten today, Jul. 30. This anniversary is coming at a moment when the platform, which powers thousands of digital applications and tools, sits in the heart of the global infrastructure of blockchain.
Vitalik But, in his Keynote at ETHCC-2025 Vitalik Buterin The importance of widespread adoption cannot be overstated. The question that really matters, according to him, is whether Ethereum serves its original function.
Buterin challenged the developers to reconsider what decentralization means. He said that many current projects use decentralization language without actually delivering the benefits.
A decentralized app may have been built using Ethereum but, if the upgrade mechanism is controlled by an intermediary, it will remain dependent.
Buterin believes that true decentralization should translate to outcomes on which users can depend. Buterin cited the work by cryptographer Phillip Rogaway who described cryptography not as just a technical area, but also a moral one.
Buterin agreed with this viewpoint and encouraged the Ethereum community not to view their work as neutral infrastructure but rather as a set of tools which shape users’ freedom.
Decentralization should be the end goal but not for itself, said he. The most technologically advanced system can fail to deliver if the user does not have more control.
Power gaps increase as users multiply
Ethereum anchors many global financial markets today web3 Infrastructure, which facilitates over two thirds of the decentralized financial activity. NFT transactions. In 2015, this scale would have been unthinkable. However, the new tradeoffs that it brings are also unprecedented.
Who participates is the most noticeable change. Ethereum’s development is not primarily influenced by grassroots or independent communities. Financial institutions, entities linked to the state, and protocol operators are increasingly influential.
Tops DeFi Applications continue to run with admin keys and proxy upgrade rights. The permissions give select teams the ability to change smart contracts, or even freeze funds. They can do this unilaterally.
It isn’t just smaller platforms that are affected. Some of Ethereum’s largest protocols retain administrative forms that go against the idea of autonomous and tamper proof execution.
Ethereum’s operating model is being influenced by the legal framework and its compliance.
Tornado Cash has been sanctioned (TORN(In 2022 several infrastructure providers are introducing filtering mechanisms including RPC restrictions at the transaction level, screening of transactions, and access control by region.
Projects such as Infura and Alchemy have developed systems to block users on the basis of their location or status.
They are not part of the Ethereum Protocol, but have a direct impact on the experience for the users. Decentralization is only at the level of the protocol, not throughout the whole stack.
Buterin cited Android as a way to demonstrate the risk of such divergence. Android may be open source but the majority of users are using a version that is modified by vendors and has non-removable applications.
Ethereum could follow a similar path, he said, unless the core infrastructure is neutral, auditable and available to users. As the distinction between formal centralization and practical decentralization becomes more difficult to ignore, it is important that users understand this.
Even after many years, Ethereum still fails tests
Buterin’s ETHCC keynote argued that decentralized systems are not always what they claim to be. In order to assess this gap, Buterin proposed A series of tests that are practical.
First, the test of walkaway. Would the protocol function properly for the users if the development team were to disappear? Or would it be impossible to access funds or run basic operations if the developers disappeared?
The answer to this question is often no, particularly in today’s layer-2 network and DeFi applications.
Buterin also mentioned the Insider Attack Test. The insider attack test measures how much harm a compromised system, malicious actors, or an insider could do.
In practice, however, projects remain highly centralized if, for instance, an entire multisignature wallet can be used to trigger a protocol update or redirect funds.
Last but not least, the final metric to consider is trusted computing base. It refers how many layers must be in place for a computer system to function securely.
Smart contracts may not be able to be changed, but they can still fail if the users rely on an oracle centralized, third-party APIs, or a RPC default endpoint.
Around 60% of layer-2 networks in 2025 will fail to pass these tests. About 60% of layer-2 network retain Administrative keys or upgrade mechanisms allow developers to modify or pause a network without the consent of all users.
Over 70% of the front-end interfaces used by Ethereum-based dApps rely upon centralized hosting. This is often done through single-domains or APIs from third parties.
Multiple known incidents show that attackers were able to inject malicious code into the interfaces. Users are exposed to losses, even if their contracts underpinnings were safe.
The governance area is another place where the decentralization of power often appears more on paper than in reality.
A study revealed that more than 80% voting power in approximately one third of DAOs is controlled by a few large token holders. This creates a structural inequality.
Formally, the decisions made are open to all but are in fact determined by an elite minority. The token-weighted vote, although widely used by many, raises questions regarding accountability and participation.
Similar limitations are found in privacy tools. Although zero-knowledge proves have been widely marketed as a revolutionary breakthrough in anonymity for users, many existing implementations mask only a portion of transactional data.
Around nine of every ten times patterns or transactions histories remain visible. Parallel, services like wallets or RPC endpoints retain data about users.
As an example: MetaMask It was revealed that the default Infura connection collected IP addresses and wallet activities, which is contrary to expectations regarding user privacy.
Ethereum applications will continue to work without fixing these structural flaws, but this won’t provide the autonomy or resilience decentralization was meant to offer.
Privacy is not optional
Buterin’s second central argument is privacy needs to become an expectation of all users, not a layer that can be added.
Currently, the majority of wallet infrastructures and interactions on chains leave data visible, externally stored, or linkable. Buterin suggested that protocol and wallet developers should integrate privacy at a deeper level.
Already, tools such as ZK and local encryption exist. The goal is to have them available by default and accessible to all, rather than being limited to niche apps.
Another area that concerned us was front-end access. Users today rely heavily on APIs or single websites to gain access to decentralized apps. These interfaces can be taken down, compromised or censored.
Buterin called for a move towards decentralized content distribution, utilizing technologies such as peer-to-peer protocol and content-addressable-storage.
The interfaces are delivered through networks such as IPFS and Arweave.ARCombining ) with front-end open-source clients can increase availability and reduce dependence on central infrastructure.
A critical vulnerability is governance. Today, the dominant voting model is token-based. This means that large holders are able to exert a greater degree of influence.
Buterin said that capital can easily capture this system, leaving no room for a fair participation.
He encouraged the research of alternative methods that would distribute influence more widely. The options under consideration include quadratic votes, identity-linked affirmations and reputation-weighted system.
Although these mechanisms are experimental, the aim is to develop governance structures that reflect users’ interests and resist concentration.
Experts discuss freedom, governance and the future
In order to determine whether Ethereum still delivers on its founding principles, Crypto.news invited leaders from the Ethereum ecosystems to assess whether Ethereum today empowers users meaningfully.
Chris Anderson of ByteNova AI started with an assessment of the decentralization. According to him, the issue isn’t theoretical.
“Many protocols still rely on upgradeable contracts and admin keys. These mechanisms allow internal teams to override or pause activity, sometimes without community approval. This undermines any claim of user control. Ethereum is progressing, but key parts of the stack still rely on discretionary authority.”
Michael Cameron (co-founder of Superb) expanded upon the criticism. He thinks that true decentralization begins at the edges of the network, and not only its protocol core.
“Access to infrastructure, the neutrality of validators, and the ability to fork or exit without friction define whether a system is decentralized. These freedoms are narrowing, especially as Ethereum’s governance structure becomes increasingly shaped by large stakeholders and institutional participants.”
Anderson cited concrete friction points using Blast as an example, in which users were required to wait for several days before they could bridge their assets to Ethereum’s mainnet.
“When exit takes days, user autonomy becomes conditional. Friction in withdrawal, unclear ownership over infrastructure, and dependence on trusted relayers all chip away at decentralization.”
Abdul Rafay Gadit (co-founder of Zignaly) focused on the hidden forms of centralization.
“Most users rely on services like MetaMask or Etherscan, which are centralized at the hosting and RPC level. While the underlying contracts may be decentralized, interacting with them often depends on infrastructure controlled by a small group of providers. Ethereum enables sovereignty, but the experience still reinforces dependency.”
Luis Bezzenberger (Head of Product, Shutter Network) raised concerns similar to mine in relation to transaction ordering, censorship and the like.
“If a user submits a transaction and it is re-ordered or front-run, they have lost control over the outcome. That breaks the principle of autonomy. Right now, front-running remains common, and censorship resistance is not enforced by design. We need systems where users retain value from their own actions.”
As a fundamental limitation, the question of privacy was raised. Bezzenberger says that privacy tools exist, but they are fragmented.
“Temporary privacy exists, but permanent privacy is still rare. Until privacy is implemented at the default level, user freedom will remain incomplete. We are working on threshold-encrypted applications, but the broader ecosystem has yet to make privacy a baseline.”
Cameron warns of the consolidation trend that resembles traditional systems in governance.
“L2 partnerships, validator coalitions, and protocol roadmaps backed by a few major actors increasingly resemble the closed alliances seen in Web2. Ethereum cannot call itself credibly neutral if upgrade paths and infrastructure decisions are concentrated.”
Varun Kabra from Concordium’s Chief Growth Officer, Varun Kabra described Ethereum operating as having two faces.
“The ethos of decentralization still exists among core developers and mission-driven builders. But around that is an orbit of large service providers, dominant L2 networks, and DAOs with disproportionate voting power. These actors shape Ethereum’s direction in subtle but powerful ways.”
He noted that there was a disconnect growing between metrics for users and actual participation.
“There are hundreds of millions of wallets, but only a small fraction of users interact regularly with applications. That gap points to poor retention and high entry friction. Ethereum still has not solved the usability problems required for broader inclusion.”
The responses were split in two when asked if builders are solving problems that matter. Anderson acknowledged Ethereum’s progress in terms of technology, but said that the priorities are still misaligned.
“Vitalik has warned that direction matters more than magnitude. Yet we often see efforts directed at highly complex problems like advanced MEV mitigation or novel proof systems while core usability issues remain. Technical achievement is not enough if it does not translate into control or access for users.”
Bezzenberger also added that two goals should be served by technical excellence.
“Privacy and fair transaction execution must be the focus. If we fail to protect users from extraction and surveillance, then even the most efficient system does not empower.”
Cameron used DeFi to illustrate his point.
“DeFi started as a path to open financial tools. Today, it is fragmented, expensive, and often inaccessible. Bridging between L2s, dealing with complex interfaces, and facing rising costs have pushed many users out. Innovation that sacrifices usability or self-custody is not helping the long-term case for Ethereum.”
The five experts were all in agreement on one key test of decentralization: freedom to depart. Gadit called this the starting point of any serious audit.
“Can users exit, fork, and rebuild without being blocked by infrastructure or governance? If that answer is not clear, then the system is not truly decentralized.”
Kabra asked if power could be distributed over time.
“Unless Ethereum makes space for new voices, challenges incumbents, and supports independent infrastructure, it risks becoming locked into its current shape. The hardest part is not building new tools. It is building in ways that resist consolidation.”
Ethereum isn’t a failure, but that its foundation remains incomplete. The consensus is not that Ethereum has failed, but rather its foundation still remains unfinished. According to them, the future of Ethereum will be determined not by performance improvements or protocol milestones, rather, whether Ethereum decides to make freedom enforced across all layers.
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