TL;DR
- The original “cypherpunk” values that inspired early smart contract platforms are being displaced by market demand.
- Blockchain commercialization is prioritizing speed, profitability and regulatory compliance over decentralization and censorship resistance.
- Jesse Walden points out that this transition does not mark the end of the original ideals, but rather “the end of the beginning,” with new opportunities for massive impact.
Over the next decade, smart contract blockchains will likely experience a significant shift in their core values, moving away from the “cypherpunk” principles that guided their creation.
According to Jesse Walden, managing partner at Variant Fund, the ideals of censorship resistance, open source, and decentralization that were once at the core of these platforms are being replaced by market demands.
Today, developers and businesses prioritize performance, profitability, and compliance over complete decentralization.
Walden argues that many of the emerging use cases for smart contract platforms, such as stablecoins or the tokenization of real-world assets (RWA), no longer need to be completely decentralized or permissionless.
These applications are now using blockchain simply for its openness, interoperability, and ability to settle transactions.
This shift has sparked reflection on the real value of the original cryptocurrencies, including the base assets of the new chains, such as Bitcoin and Ethereum, which have historically been seen as censorship-resistant digital money.
Despite this change, Walden says this is not the end of cypherpunk ideals, but rather a new stage in the evolution of cryptocurrencies.
The commercialization of blockchain technology, while bringing with it compromises, also opens the door to mass adoption that can expand its global impact.
This expansion into the mass market comes with some trade-offs, such as less decentralization in favor of scalability, which would allow cryptocurrency apps and wallets to be put into the hands of more people.
This, in turn, could set the stage for future improvements in decentralization.
The future of “cypherpunk” securities on the Blockchain
Walden points out that while commercialization dilutes some of the original values of cryptocurrencies, it is not all bad.
As in other creative industries, the challenge lies in finding a balance between core principles and what is acceptable to a wider audience.
To illustrate this, Walden recalls his experiences in the Montreal cultural scene, where he saw how certain artists and movements were adopted by the mainstream market, some sacrificing their authenticity, while others managed to maintain their essence and achieve a greater impact.
This process of adaptation does not mean that “cypherpunk” ideals have lost relevance.
On the contrary, it offers a unique opportunity for people involved in the development of blockchain technology to influence the direction in which the ecosystem evolves.
Walden suggests that it is possible to make strategic compromises to increase reach without completely abandoning the core principles that attracted many to the world of crypto in the first place.
As smart contract platforms continue to evolve and adapt to market demands, we are likely to see more trade-offs between decentralization and efficiency.
However, this should not be seen as a defeat, but rather as an opportunity to continue shaping the future of blockchain technology.
According to Walden, the real opportunity is just beginning, and the next chapter in cryptocurrency development could be even more impactful and transformative than the first.
