Vitalik Buterin founder of Ethereum, explains the true democratic potential of blockchain technology.
We live in a time rife with misinformation, data exploitation, and cyber-attacks. We wade through opaque bureaucracy. Trade through expensive middlemen. And a large a portion of our world still lacks access to basic online services.
One brilliant programmer, however, is offering a solution. Twenty-three-year-old Vitalik Buterin has laid a foundation for change — the world just needs to embrace it.
When Buterin was first exposed to Bitcoin in 2009, he became enamoured with cryptocurrency and its underlying technology. Fuelled by reformist ideas and a strong online scene, he left home aged 18 on a blockchain pilgrimage.
Buterin scoured the globe for other enthusiasts; he met with programmers and developers; activists and anarchists. But the moment of true absolution, he says, arose at a conference in San José — at the heart of the Silicon Valley. “It was a big event with over 1,000 people,” he said. “All of them were just incredibly excited about what they saw as the new paradigm and the possibilities that it could accomplish.
“All of that, live, in one place made me realise that this thing is real — this is worth me sinking at least a few years of my life into.”
In 2015 Buterin created Ethereum, a decentralised platform for applications without any chance of fraud, censorship or third-party interference. Dubbed the 'Internet 2.0', it is designed to revolutionise online trade.
The Ethereum platform is built using blockchain technology. Once a transaction enters this public ledger, it’s permanent. It can be viewed, but not changed by anyone. The strength of this ledger lies in its decentralised nature, where blocks are kept in servers and hard drives all over the world. Although it may sound counter-intuitive, by not having one central hub, the technique keeps data secure from manipulation or theft.
Bitcoin was the first application built using blockchain. But the technology can be used for a lot more than just currency, explains Buterin. “The idea for Ethereum came when I realised there were so many different kinds of possible applications,” he says. “It didn’t make sense to support them all one by one.”
Run on its own digital currency, Ethereum is an open-source platform that gives developers the scaffolding to build any kind of decentralised application. Services built on the Ethereum platform use Smart Contracts to conduct activity or transactions. These are computer codes that function as the ‘middlemen’ to verify information and enforce rules. They function exactly as programmed and are incredibly efficient, secure and private. “Instead of you talking through a [third party], you’re able to talk to people directly,” explains Buterin. “And any information that’s between the two of you, would stay just between the two of you.”
Just like Bitcoin has enabled peer-to-peer electronic payments — removing the constraints of traditional financing — Ethereum appears to have similar benefits, only across more industries and at a much larger scale. Disruptive applications are being rolled out daily, bringing more transparency, democracy and security to where they’re most needed.
Authenticity within global supply chains, for one, could be profoundly improved, says Buterin. “If you’re buying some food or medicine, you might ask: ‘Where did this thing come from?’ ‘Do I trust the people who produced it?’
“You have this complex supply chain, consisting of thousands of different companies worldwide, and you [need] a common shared network to trace every product all the way back to where it came from.”
By making this information freely accessible, say via a smartphone app, Buterin explains, will help usher in a new trend of cleaner and conscientious consumerism. This ability to accurately track origins will also benefit creative industries. Kodak recently announced plans to use Ethereum Smart Contracts in their new rights management platform. This will allow photographers to attach a digital tracker to their work, ensuring proper use and direct royalties.
Governments are also jumping on board. In a bid to increase transparency and security, Moscow’s government recently announced plans to move its Active Citizen voting program on to Ethereum. Now, local citizens will be able to verify votes and see the results in real time.
Brazil will also follow suit with petitions, according to Quartz. Manually gathering and verifying signatures of 145 million votes has, so far, proved impossible. This is where a fully secure online alternative could make a serious impact, as any petition that gathers signatures from one per cent of Brazil’s voters is presented to Congress.
While scaling the platform will take time, lead engineer at Ethereum, Nick Johnson, sees it eventually becoming a pervasive, to the point of almost invisible, force for good. “This new infrastructure is forming the backbone of the next evolutionary stage of the internet,” he explains. “In 10 years time, I anticipate there’ll be many well-integrated programs on the blockchain to benefit global society. “Programs we’ll all interact with, but won’t even realise they’re enabled by Ethereum.”
With scaling and wide adoption, Ethereum is capable of turning traditional wealth, trade and political systems bottom up. By providing a neutral, bulletproof system that can collect, verify and conduct all kinds of transactions, Ethereum creates a true user-controlled environment. Citizens need only trust the code, not any particular individual or central entity with an agenda of profit or power.
At heart, Ethereum offers a redistribution of power — from the few to the many.
This article originally appeared in Billionaire's Ideas issue, March 2018. To subscribe contact
This article was featured in:
The Ideas Issue