Etherealize CEO: Wall Street's closed blockchains are a "race to the bottom"
Vivek Raman, co-founder and CEO of Etherealize, has sharply criticized the growing trend on Wall Street—the fascination with closed blockchain networks with restricted access. In his recent assessment, he called this trend nothing less than a "race to the bottom," emphasizing that consortium networks not only fragment the market but also return the industry to the very isolated systems that distributed ledger technology was supposed to move away from.
In my analysis, the key issue here is deeper than it seems at first glance. Closed circuits that do not interact with each other destroy two fundamental advantages of blockchain: system interoperability and liquidity concentration. Instead of a single pool of assets, we get scattered "lakes" that do not communicate with one another. This is a direct path to stagnation, not innovation.
Privacy on top of the public layer
Etherealize, as is well known, promotes Ethereum as an open base layer for institutional players. Raman insists: privacy and access restrictions should be built on top of public infrastructure—at the application or L2 solution level, rather than by creating separate closed networks. He draws an analogy with the internet: Ethereum is HTTP, and additional layers with restricted access are HTTPS. No one thinks of building a "private internet" for banks, so why is this considered acceptable in blockchain?
Examples of the latest wave of such "closed" solutions include Canton Network from Digital Asset, the Arc project from Circle, and Tempo from Stripe. Raman dubbed this "consortium chains 2.0," recalling the sad fate of their predecessors—the interbank initiative R3 and the corporate ecosystem Hyperledger, which were actively promoted since 2016 but never gained real traction.
Etherealize's position
"We firmly believe and have always held this position that a global, open permissionless infrastructure is necessary as the base layer," stated the head of Etherealize. Notably, back in June, Raman argued that traditional financial organizations had begun integrating Ethereum-based solutions into real business processes, confirming the viability of his approach.
My conclusion: In the short term, closed networks may seem convenient for banks accustomed to control, but in the long term, they lose to open systems in terms of network effects. Ethereum, with its liquidity and developer ecosystem, offers institutions something no consortium can replicate—scale and interoperability. The question is only when Wall Street will realize this.