Ethereum developer Federico Carrone expresses concerns that the increasing influence of corporations like Paradigm on the network could pose a “tail risk” for the Ethereum ecosystem.
In a post on Sunday, the Ethereum core developer, known as “Fede’s intern” on X, argued that while Paradigm has contributed positively to the community, he is apprehensive about the increasing sway of a venture fund whose ultimate objectives center around profit and influence.
“For the past two years, I’ve been warning that @paradigm’s influence within Ethereum may become a significant tail risk for the ecosystem. I believe this will become clearer to everyone in the coming months.”
Carrone noted that although Paradigm’s recruitment of key Ethereum researchers and financing of vital open-source libraries appears beneficial, it raises concerns for those who believe Ethereum should embody a “philosophical and political” movement transcending corporate interests.
Paradigm has been involved in various Ethereum initiatives over the years, including developing the Rust-language-based Ethereum software, Reth.
One of their recent significant endeavors includes the incubation of a competing layer-1 blockchain, Tempo, in collaboration with fintech leader Stripe.
Tempo is still under development and will focus on stablecoins and payments, effectively placing Stripe in control of the network. This stands in stark contrast to Ethereum’s decentralized and open-source ethos, as it will be a corporate-led chain.
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Ultimately, Carrone’s worries revolve around the contrasting objectives of decentralized versus centralized entities, and the risks of allowing any fund—whether it be Paradigm or others—to wield excessive influence over the Ethereum ecosystem.
“Ethereum must proceed with caution about forming a strong technical dependency on a fund that maneuvers strategically.”
“When corporations gain excessive visibility and influence over open-source projects, the focus tends to shift from the community’s long-standing vision to corporate incentives. That’s where misalignment begins.”
Cointelegraph reached out to Paradigm for comments but did not receive a response by the time of this writing.
Paradigm crypto ventures
Paradigm is a crypto and AI investment firm established in 2018 by Matt Huang, a veteran of VC giant Sequoia, and Coinbase co-founder Fred Ehrsam.
It has made extensive investments across the market, spanning DeFi, NFTs, blockchain security, infrastructure, and startups.
In its initial announcement of Tempo in September, Paradigm delineated its objective to advance crypto technology and adoption through a combination of investing, building, and researching.
“This aids us in understanding friction points and opportunities and keeps us aligned with the forefront of what’s achievable,” reads the announcement.
Beyond financial moves, it has undertaken multiple actions indicating a strong commitment to the crypto community. From submitting an amicus brief supporting Tornado Cash co-founder Roman Storm to recruiting respected blockchain investigator ZachXBT as an adviser to bolster research and protect its VC investments.
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