Wall Street's closed blockchains are a dead end: Etherealize CEO accuses banks of a "race to the bottom"
The financial mainstream is once again making the same mistake it did a decade ago. Vivek Raman, co-founder and CEO of Etherealize, sharply criticized the new wave of Wall Street enthusiasm for closed blockchain networks with restricted access. In his assessment, this trend is not just unpromising—it is destructive to the entire ecosystem.
Raman emphasizes that consortium networks inevitably fragment liquidity and return us to the model of isolated digital enclaves that distributed ledger technology was supposed to leave behind once and for all. He bluntly calls this new round of activity a "race to the bottom." Closed circuits incapable of interacting with each other negate two key advantages of blockchain: interoperability and the concentration of liquidity pools.
Architectural conservatism versus open standards
Etherealize's position is consistent: Ethereum should become the base layer for institutional players. However, Raman insists that privacy and access control are tasks for the application layer or L2 solutions, not a reason to create parallel closed infrastructures. He draws an elegant analogy: in his scheme, Ethereum is HTTP, the foundation of the global network, while HTTPS and other security mechanisms should be built on top without breaking the base protocol.
As an illustration of "consortium chains 2.0," he cites Canton Network from Digital Asset, Circle's Arc project, and Stripe's Tempo payment network. Raman reminds us that we have already walked this path: the ambitious initiatives of R3 and the Hyperledger corporate ecosystem, actively promoted since 2016, never managed to move beyond pilot projects and died without achieving scale.
"We have always held a firm position: a global, open permissionless infrastructure is needed as the base layer," stated the head of Etherealize.
Notably, back in June, Raman was documenting the shift of traditional financial organizations from experimenting with Ethereum to real implementation in business processes. However, the current tilt toward closed networks indicates that old-school thinking inertia remains the industry's main brake.
My comment: Raman's arguments look convincing, especially against the backdrop of the failure of previous consortium projects. The market has already proven that blockchain's value lies in the network effect, not in isolation. If Wall Street continues to spawn closed sandboxes, they risk remaining expensive toys, while open networks continue to capture real liquidity and innovation.