Vivek Raman, co-founder and CEO of Etherealize, warns that Wall Street's growing interest in private blockchains represents a detrimental trend, potentially leading to isolated systems that undermine the very interoperability and liquidity that blockchain technology aims to provide.
According to Raman, while centralized, permission-based networks may have a place in the finance sector, they must operate on a transparent and open foundation to fully leverage blockchain's advantages. Etherealize, which has backing from Ethereum co-founder Vitalik Buterin and the Ethereum Foundation, promotes Ethereum's open mainnet as a neutral platform where institutions can implement permissioned and privacy-focused features at higher levels.
The swift adoption of gated networks by prominent companies contrasts sharply with the emergence of new Ethereum-based products from firms such as BlackRock, intensifying the debate over whether institutional adoption will lean toward open public chains or curated systems dominated by corporate interests.
Raman describes the resurgence of private, permissioned "consortium chains" as a regression to siloed systems, reminiscent of earlier initiatives like R3's consortium efforts from 2016, which ultimately failed as major banks withdrew. He argues that this trend could lead to a "race to the bottom" among consortium chains.
He compares Ethereum's mainnet to the foundational layer of the internet, HTTP, suggesting that just as HTTPS builds on it for enhanced security, a robust open base is crucial for maximizing interoperability and liquidity in blockchain networks. Raman emphasizes the need for a globally accessible, permissionless infrastructure as the foundational layer, allowing for customizability at the application and layer-2 levels.
However, the landscape has shifted since 2016, raising questions about the market's commitment to decentralization and the principles of blockchain. Christian Catalini, founder of the MIT Cryptoeconomics Lab, notes that the current phase is heavily focused on enterprise sales, leading to uncertainty about whether the industry will favor curated networks with defined sponsors, potentially stunting the competitive benefits of blockchain technology.
Etherealize aims to bridge this gap, having received initial funding from Buterin and the Ethereum Foundation in January 2025, followed by a $40 million Series A round later that year. Raman points to BlackRock's recent Ethereum-based funds as a sign of progress, suggesting that once regulatory clarity is achieved, institutional investments will favor open networks that are not controlled by any single entity. He cautions that engaging with consortium chains may limit incentives for participants not involved from the outset.