Ethereum Faces Dual Threats From Institutions, Vitalik Buterin Warns of Decentralization Erosion and Harmful 150ms Block Time

Ethereum founder Vitalik Buterin warned at the Argentina Devcon that growing institutional holdings of ETH could threaten two key pillars: decentralization and core developer engagement.

The first risk is alienation of those who champion decentralization, potentially eroding the global open-source ecosystem. The second risk is misguided technical choices under external pressure, such as endorsing a shorter block time that benefits high-frequency traders but burdens node operators and fosters geographic centralization.

Buterin emphasized that Ethereum‘s mission remains a global, permissionless, censorship-resistant protocol, and urged preserving a strong core community and the values that distinguish the project from traditional finance.

COINOTAG News notes that nine Wall Street firms hold more than $18 billion in ETH, with industry observers cautioning that institutional exposure could approach double-digit shares of the total supply.