Vitalik Buterin painted a concerning picture for the sector, stating that three fundamental structural problems remain unresolved, hindering the long-term sustainability of decentralized stablecoins.
Buterin, one of the most influential figures in the Ethereum ecosystem, emphasized in an article published on X that the cryptocurrency world needs "better decentralized stablecoins." However, he explicitly stated that the models developed so far are insufficient to achieve this goal.
The reference to the dollar poses long-term risks
According to Buterin, most decentralized stablecoins are still pegged to the US dollar. While this is understandable in the short term, he argued that this approach poses serious long-term risks. In particular, he observed that if the dollar experiences inflation or depreciation within 20 years, these stablecoins could lose their fundamental purpose. Therefore, he suggested that in the future, discussion should focus on broader purchasing power parity indices rather than the US dollar.
Oracles remain vulnerable
The second major issue is oracle systems. Buterin stated that if actors with significant capital can manipulate price oracles, the entire protocol becomes vulnerable. In such cases, projects are forced to resort to high fees and value transfer mechanisms that harm users, increasing the cost of attacks. Buterin linked this structure to the concept of financialized governance, which he has long criticized.
The staking and competition dilemma
The third point addressed the issue of staking yield. The return generated by assets staked on Ethereum creates an indirect cost for stablecoin users. Buterin stated that this contradiction has not yet been sustainably resolved. He particularly emphasized that options such as low staking yields, risk-free staking models, or shifting risk to the user are only theoretical possibilities.
Buterin's statement provides a solid framework explaining why centralized actors still dominate the stablecoin market, which is approaching $300 billion.
