Etherealize CEO warns private blockchain revival risks repeating past failures
Key points
- Vivek Raman, CEO of Etherealize (backed by Vitalik Buterin and the Ethereum Foundation), has labelled the resurgence of private consortium blockchains a 'race to the bottom,' warning they recreate siloed systems that undermine interoperability and liquidity.
- Raman cited the R3 consortium from 2016, from which Goldman Sachs, Morgan Stanley, and Santander all withdrew within the year, as a precedent for how corporate blockchain consortia tend to fragment rather than converge.
- The current wave of gated networks includes Digital Asset's Canton Network, Circle's ARC stablecoin payments product, and Stripe's Tempo blockchain, all of which compete with Ethereum-based offerings from firms such as BlackRock.
- Etherealize's position is that an open, permissionless base layer is a prerequisite for maximum interoperability and liquidity, with permissioning and privacy controls added at the application or layer-two level rather than baked into the base.
- Christian Catalini, founder of the MIT Cryptoeconomics Lab and former chief economist of Facebook's Diem project, offered a counterpoint, framing the current environment as primarily driven by enterprise sales dynamics rather than decentralisation principles.
Vivek Raman, co-founder and chief executive of Etherealize, has publicly challenged the growing institutional preference for private, permissioned blockchains, arguing that such systems recreate the fragmented silos the technology was designed to eliminate. Raman characterises the current wave of consortium chains as a repeat of earlier failed experiments, pointing to R3’s consortium effort from 2016, which saw major banks including Goldman Sachs, Morgan Stanley, and Santander withdraw before the year was out, and to the Hyperledger ecosystem that similarly attracted enterprise interest without achieving durable adoption.
Etherealize, which is backed by Vitalik Buterin and the Ethereum Foundation, advocates for Ethereum’s open mainnet as the foundational layer for institutional activity, with permissioning and privacy features added at higher application or layer-two levels. Raman drew an analogy to internet architecture, comparing Ethereum’s base layer to HTTP and arguing that a more restrictive, privacy-enabled layer sitting on top (comparable to HTTPS) is a legitimate design choice, but only when the open layer beneath it exists. The alternative, he contends, produces competing closed systems that drive each other toward a lowest-common-denominator outcome. The current debate is sharpened by the simultaneous rise of gated networks such as Digital Asset’s Canton Network, Circle‘s ARC payments product, and Stripe’s Tempo blockchain alongside Ethereum-based product launches from firms like BlackRock.
Not all observers share Raman’s view. Christian Catalini, founder of the MIT Cryptoeconomics Lab and former chief economist of Facebook’s Diem stablecoin project, argued that the current phase is fundamentally about enterprise sales, noting genuine tension at precisely the moment large capital flows are arriving. Whether institutional adoption ultimately favours open public infrastructure or curated, sponsor-controlled networks remains an open question, and Raman’s commentary arrives at a moment when that choice is being made in practice rather than in theory.