Vitalik Buterin Admits: I completely Missed NFTs Despite Predicting DeFi

The start of a new year provides an opportunity to reflect on the past and move forward with intention and purpose. And while other crypto personalities started 2022 with bullish predictions, Ethereum’s co-founder Vitalik Buterin chose to travel back in time, revisiting some of the things he predicted over the last ten years. He also shared what he learned and what he thinks about the subjects today.

As a programmer, writer, and an active member of the cryptocurrency space since its early years, Buterin has said, written and predicted a lot of things about the industry. Some he nailed, some he missed, and others very laughable. But for one thing, he doesn’t shy away from admitting when he’s wrong about his predictions.

Vitalik on Bitcoin Adoption and Regulation

Before launching Ethereum in 2015, Buterin was bullish on Bitcoin: he even wrote an article in July 2013 explaining the “internationality and censorship resistance” of Bitcoin and how the leading cryptocurrency can help protect the purchasing power and wealth of citizens in countries like Iran, Argentina, China, and Africa.

The Ethereum co-founder said in a Twitter thread that he visited Argentina last week and he noticed that crypto adoption was high but stablecoin adoption was higher as businesses use USDT for their operations.

Last week, I actually went to Argentina! My verdict: generally correct. Cryptocurrency adoption is high but stablecoin adoption is really high too; lots of businesses operate in USDT. Though of course, if USD itself starts showing more problems this could change.

— vitalik.eth (@VitalikButerin) January 1, 2022

Buterin then went on to reflect the negative impact of Bitcoin regulation he predicted about ten years ago. At the time, the programmer argued that “Bitcoin is resisting the government not by being clever about what ‘legal category’ it’s in, but rather by being technologically censorship-proof.”

Today, Buterin believes Bitcoin’s decentralization would allow it to survive in any super-hostile regulatory climate, but at a cost – “It could not thrive.”

“Successful censorship resistance strategy requires a combination of technological robustness and public legitimacy,” he wrote.

Wrong About Ethereum’s PoS and Shrading Timeline

The Ethereum co-founder recalled how he was briefly an apologist for PoW energy waste in 2012. However, he became excited when he learned about proof of stake as a promising alternative in 2013 and he fully bought the idea by 2014. Buterin tagged his transition as a  broader intellectual evolution.”

Buterin also highlighted his predictions about the timeline of Ethereum’s PoS and Sharding while admitting that they were wrong and laughable. He also noted that underestimating the complexity of software development was his core underlying mistake.

But what was my core underlying mistake? IMO it’s that I deeply underestimated the complexity of software development, and the diff between a python PoC and a proper production impl. 2014-era ideas were waaay too complex, eg. “12-dimensional hypercubes”:https://t.co/MIKWiowHrB pic.twitter.com/0FNf6BY9sE

— vitalik.eth (@VitalikButerin) January 1, 2022

Next on Buterin’s list was his comments on the internet of money. He still maintains that “the internet of money should not cost more than 5 cents per transaction,” and that’s why Ethereum developers are working round the clock to improve the network’s scalability.

“Bitcoin Cash is a Failure”

Buterin also recalled an article where he defended altcoins in 2013 for three points – different chains optimize for different goals, costs of having many chains are low, and the need for an alternative in case the core development team is wrong.

But his views about some altcoins have changed drastically. For instance, Buterin said he was optimistic about Bitcoin Cash in 2017. However, the programmer sees BCH as a failure now because of the rebellious nature of its community.

Today, I would call BCH mostly a failure. My main takeaway: communities formed around a rebellion, even if they have a good cause, often have a hard time long term, because they value bravery over competence and are united around resistance rather than a coherent way forward.

— vitalik.eth (@VitalikButerin) January 1, 2022

Predicted DeFi, but Missed NFT

Citing Ethereum’s whitepaper, Vitalik Buterin noted that he predicted Decentralized Finance (DeFi) among other decentralized applications, but he completely missed NFTs.

A lot correct (basically predicted “defi”), though incentivized file storage + compute hasn’t taken off that much (yet?), and of course I completely missed NFTs.

I would say the biggest thing I missed in the details is collusion issues in DAO governance: https://t.co/cezOk10KQ0

— vitalik.eth (@VitalikButerin) January 1, 2022

Early Mistakes Corrected Quickly

Conclusively, Buterin admitted that his “thinking about politics and large-scale human organization was more naive then,” adding that he made a couple of early mistakes which he corrected quickly. The programmer also noted that he had “good instincts early on for avoiding the craziest parts of bitcoin maximalist thinking.”

* On tech, I was more often right on abstract ideas than on production software dev issues. Had to learn to understand the latter over time
* I have a deeper appreciation now of the need for even more simplicity than I thought we needed

— vitalik.eth (@VitalikButerin) January 1, 2022