Wall Street’s closed blockchains are a “race to the bottom”: Etherealize CEO slams consortium networks.
Vivek Raman, co-founder and CEO of Etherealize, has sharply criticized the growing trend on Wall Street—the creation of closed blockchain networks with restricted access. In his view, this path leads the industry into a dead end, which he bluntly calls a "race to the bottom."
At the center of Raman's complaints are consortium networks, which, he argues, not only isolate liquidity but also completely negate two fundamental advantages of distributed ledger technology: interoperability and capital concentration. Instead of uniting the market, such projects fragment it into isolated "pockets," returning us to the era of closed banking systems that blockchain was supposed to move away from.
Public Foundation vs. Private Enclaves
Etherealize, which Raman represents, positions Ethereum as an open base layer for institutional players. He insists: privacy and access control are tasks for the application layer or L2 solutions, not a reason to create separate closed networks. He illustrates his logic with a simple analogy: Ethereum is HTTP, the global communication standard, while private layers are HTTPS, which adds encryption on top without breaking the underlying infrastructure.
As examples of "consortium chains 2.0," Raman cites Canton Network from Digital Asset, the Arc project from Circle, and Tempo from Stripe. He reminds that similar initiatives have already appeared in history—the interbank platform R3 and the enterprise-focused Hyperledger, which were actively promoted since 2016 but never achieved widespread adoption. Essentially, we are witnessing a repeat of the past, but with new names.
"We firmly believe and have always held this position that a global, open permissionless infrastructure is necessary as the base layer," emphasizes the head of Etherealize.
Notably, back in June, Raman stated that traditional financial institutions were moving from experiments with Ethereum to real implementation in business processes. This new wave of criticism looks like a logical continuation of that stance: institutional players have already understood Ethereum's value, and now it is crucial not to let them veer onto the erroneous path of creating isolated sandboxes.
My view: Raman's criticism is absolutely justified from the perspective of market efficiency. Closed blockchains are an oxymoron that strips the technology of its main asset—the network effect. However, one should not discount regulatory requirements and corporate standards, which often push banks toward "private" solutions. The question is not whether the blockchain is public or private, but whether the industry can find a hybrid model where privacy does not mean isolation. For now, we see how the fear of openness gives rise to architectural solutions that contradict the very essence of the technology.