Ethereum co-founder and Consensys founder Joseph Lubin highlighted the importance of venture capital (VC) funding for the development of the world’s largest smart contract network, despite growing industry concerns over the influence of investment funds on Ethereum.
The main goal of VCs like Paradigm is to « suck as much value as possible from the Ethereum and broader ecosystem, » while their secondary goals include « progressing the systems towards rigorous decentralization, » wrote Lubin in a Monday X post, adding that there is “no reason for concern.”
Lubin’s comments come shortly after the departure of two key Ethereum researchers, which caused renewed concerns over the potential influence of centralized funds over Ethereum’s development.
On Friday, longtime Ethereum Foundation researcher and developer Dankrad Feist announced his departure to join Tempo, a layer-1 blockchain for payments and stablecoins built by Stripe and Paradigm.
Former Consensys researcher Mallesh Pai joined Paradigm as a research adviser in January, before joining Tempo in a full-time role in September, according to his LinkedIn page.
Despite industry calls over Paradigm’s growing influence on Ethereum, Lubin saw Paradigm’s new hires as another signal for the blockchain industry’s growing mainstream adoption.
“The gold rush of corpo-chains is validating for the traditional economy and signals our mainstreaming,” added Lubin in the X post.
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Crypto needs VCs “for now” to bridge global capital gap, Lubin says
Despite growing concerns over VC influence on the blockchain space, the industry still relies on traditional investment funds to attract more mainstream capital for sustained development.
“We need VCs for now because they represent a comfortable bridge for the world’s capital to flow into our ecosystem,” wrote Lubin, adding:
“Very soon better, fairer, more broadly accessible onchain investment platforms with healthy tokenomics will mature sufficiently so that VCs will have no choice but to set up shop on these platforms, if they want to stay in the game.”
VC participation remains necessary to bring the “progressive decentraliztion” needed to achieve a “secure global information infrastructure,” explained Lubin.
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Paradigm’s Tempo blockchain is building a network with a curated set of validators, which will essentially be controlled by Stripe, marking a steep departure from Ethereum’s decentralized, open-source ethos.
Paradigm first announced plans for the payments-focused blockchain network in September, citing a “growing need for optimized infrastructure” that scales for global payments.
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