Blockchains Controlled by Corporations Will Eventually Die Predicts StarkWare CEO, Eli Ben-Sasson

According to Eli Ben-Sasson, the co-founder and CEO of blockchain company StarkWare, blockchains that are created and controlled by corporations are doomed to fail eventually. The rationale behind his prediction is that users will pull away from blockchains that are managed by a central entity.

The Fate of Corporate-Controlled Blockchains

Ben-Sasson argues that corporate chains won’t endure due to a misalignment with the fundamental concept of blockchain. The essence of blockchain technology lies in its decentralization, eliminating the need for a central entity. It’s inherent setup, however, is highly intricate, difficult to build and challenging to use. This characteristic remains true despite the use of account abstraction (AA) to create a simplified user experience — a method that frees users from handling traditional private keys. To illustrate his point, Ben-Sasson uses the example of Bitcoin, the first cryptocurrency. It was designed to disrupt mainstream financial institutions and return financial power to individuals. This tenet may be why sections of the cryptocurrency community are wary of new chains, such as Stripes’ new layer-1, Tempo.

Reactions to Corporate Adoption of Blockchain

On a positive note, Ben-Sasson acknowledges that it’s promising to see corporations showing interest in blockchain technology. This shift in perception means that blockchain is no longer considered as intimidating or daunting as before. Reacting to a user’s query, he agreed that in the short term, chains created by large financial giants could indeed facilitate mainstream adoption. Nevertheless, he foresees that these chains are likely to be discarded in the next few years. Technical complications could present significant problems, and users may prefer to avoid these chains, believeing they aren’t appealing enough from a decentralized finance (DeFi), self-custody, or control-my-asset perspective.

The Pressure to Adopt Blockchain

Voicing a common sentiment, an online user named ‘Boluson’ argued that not all corporations require a blockchain setup. According to him, several corporations are hastily adopting the technology more out of a fear of being left behind than actual need. In connection to this, not every project within Crypto needs to embody blockchain, despite the existing trend of building something around creating a blockchain.

Corporations and Blockchain: Another Perspective

Providing another perspective, Rob Masiello, the CEO of Sova Labs — a firm focused on developing Bitcoin-native infrastructure — believes that corporate chains will prove to be successful and useful to the owning and operating companies. However, he also stated that users wouldn’t have any means to participate in the chains’ upside, with ‘Base’ cited as an example. Increasing speculation suggests that corporations might develop blockchains, subsequently transferring control to native firms, or they may acquire existing blockchains and upscale them for their intended purposes.

Conclusion

Overall, the future of corporation-produced blockchains remains uncertain. While they may initially facilitate mainstream adoption of blockchain technology, it appears they may simply serve as stepping stones to a more decentralized environment. Blockchain’s principle of elimination of a central entity may prove to be an insurmountable hurdle for corporations aiming to control and navigate this revolutionary technology for their benefit.