It’s no secret Ethereum was among the hardest hit coins during the crypto winter after a tough year of regulatory uncertainty surrounding security tokens and ICOs. If anyone should seem worried, it would be blockchain pioneer Joseph Lubin, whose company ConsenSys is an incubator for Ethereum projects. Yet, he couldn’t appear further from losing sleep. Lubin was featured as the Interactive Keynote speaker at SXSW 2019, where he shared his zen vibe with a live audience, saying:
“Ethereum is not going away. It’s not going to fail. It will remain very significant.” *
Increasingly, there are reasons to be optimistic about the Ethereum’s future. Most recently SEC Chairman Jay Clayton seemingly agreed that digital assets might not be securities based on the Howey framework. ConsenSys is “intimately associated with the Ethereum protocol.” It has 85 Ethereum blockchain protocol engineers busy building day in and day out.
“ConsenSys projects and tools are focused on Ethereum because it’s the only game in town, really,” said Lubin.
The way he sees the world, ConsenSys is more dependent on a decentralized ecosystem succeeding than it is any one project. “We’d probably give up if…a decentralized World Wide Web never materialized,” said Lubin, pointing to decentralized bandwidth, identity, and lots of other interoperating decentralized protocols.
Of course, the elephant in the room was the ETH price, which since plummeting has been stuck in a rut and unable to break out of a pretty narrow range. Lubin, however, was with Vitalik Buterin from almost the beginning and has seen market cycles come and go. He is playing the long game.
“Since the start of the ecosystem and since 2009, we’ve seen many incredible rises in the price of these tokens followed by very significant corrections. So the most significant correction took us back one year, which was 5,000-times more valuable than when ETH was initially launched. In that context, it’s not so horrifying.”
When times are good in the market, it brings attention to the ecosystem. Technologists and entrepreneurs are busy building. “There is way more activity in our ecosystem now than a year or 18 months ago,” said Lubin. Fewer people pay attention to the price of the token. But maybe that’s not such a bad thing because there’s a far greater increase in the number of people building things such as privacy and confidentiality systems, scalability solutions, and ETH 2.0.
Lubin sees nothing but blue skies ahead for Ethereum.
Before Ethereum can reach its wide-scale adoption, it needs to scale. Currently, it can complete between 14 and 27 transactions per second (TPS), the latter of which reflects tiny transactions. Technologies such as Plasma are Layer 2 technologies that will bolster Ethereum’s scalability and make the blockchain much more useful. With Layer 2 technologies, smart contracts on Ethereum can run off-chain.
“Ethereum 2.0 is coming…we have eight teams building it,” said Lubin, adding that they’re in “phase 0 of four phases.” This base layer upon which we continue to build Layer 2 scalability solutions is going to expand by at least 1,000-fold over the next 18-24 months from now. It will keep expanding after that.”
As for the broader blockchain movement, he is similarly bullish. Lubin, who is a Princeton grad, pointed to the size of the global economy, which is $80 trillion.
“When the blockchain fully ramifies and in 10-20 years the economy will probably be 10x as large. The blockchain will probably be the majority part of that; in dollar terms, a lot,” he said.
Lubin is confident about the potential of the blockchain across sectors of the economy. There isn’t an industry out there that doesn’t need trust and agreements, which are what the blockchain provides. Developers can build platforms that facilitate collaboration over competition. It reflects a paradigm shift from the way that the world works today.
*Lubin’s quotes are a rough translation of a live-streamed event.