Blockchain Is Struggling To Hold On To Its Original Purpose: Aztec CEO
Blockchain is being pulled between traditional finance and its decentralized ethos as the industry shifts to serve institutional products.
Zac Williamson, CEO of Aztec Labs, said early decentralized governance failures shifted blockchain’s trajectory away from community coordination.
“There is a real risk that blockchain just becomes a slightly more efficient settlement layer than Visa or Mastercard,” he told Cointelegraph. “If we lose the social coordination side of this, then the entire point of the technology gets hollowed out.”
Back then, blockchain was pushed as an alternative to the existing financial system. Today, the momentum is behind institutional adoption, leaving builders like Williamson wondering whether the technology can still support its roots.
Williamson described the split in blockchain’s purpose as two competing canons. One canon treats blockchain as a monetary system designed for creating and trading digital assets, generating yield and integrating with traditional markets. The other sees it as a tool for collective action, where groups of people can organize, vote and coordinate without intermediaries.
The latter canon saw its first major test in 2016 with The DAO, when thousands of users pooled funds and attempted to govern a shared treasury onchain.
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The experiment collapsed after an exploit drained 3.6 million Ether (ETH), triggering a crisis that ultimately split the Ethereum network. One chain chose to reverse the theft, becoming the Ethereum used today, while the other continued without the rollback as Ethereum Classic.
The DAO also exposed how unprepared the governance model was for real-world coordination, Williamson said.
The monetary canon gained momentum as early governance experiments failed. As capital, developer attention and regulatory frameworks rallied around financial use cases, blockchain’s public identity shifted alongside them.
Source: CoinTelegraph
