At DevConnect, Ethereum’s cypherpunk core collides with the pull of mainstream opportunities
On my last night in San Martín de los Andes, a bus-full of Edge City residents wound its way uphill to enjoy a delightful asado dinner — ribeye, lamb, flank steak, maillard-crusted veggies, a lettuce leaf or two. Pure decadence.
Three hours and some generous pours of Malbec later, the group filtered outside to stargaze and reminisce about the days spent together. Far from the light pollution of San Martín’s small downtown core, the stars were plainly visible. As if on cue: a shooting star.
“What do you wish for?” one resident asked.
“Ethereum hitting $5,000,” another one joked.
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For all the talk of decentralization, democratization, disaggregation, civilization-building, cypherpunkery, and so on, crypto communities’ futures are invariably wrapped up in the financial underpinnings of the technologies and tokens powering their work. If the coin of the realm — the cryptocurrency held by an ecosystem’s most prominent institutions, who often sell tranches of their coin to fund their work — collapses, then the realm most likely collapses, too.
This dual mandate — a civilizational project, but also an asset-value-generating one — has forced groups like the Ethereum Foundation, and the Ethereum ecosystem writ large, to straddle two worlds, speaking two tongues. Ethereum is the second largest crypto ecosystem by market cap, currently valued above $350 billion. The Ethereum Foundation is the ecosystem’s de facto brain trust and coordinating body.
It takes just two days in Buenos Aires at DevConnect, the “world’s fair” for the Ethereum community, to plainly see its duality clash, making for lively debate and occasional inconsistency.
On Sunday, a group of self-identified “cypherpunks” — ardent proponents of encryption, privacy, and the use of technology for individual protection from state surveillance and oppression — hosted the second Ethereum Cypherpunk Congress, a side event designed for the Ethereum community’s more die-hard ideological core.
In the vaulted atrium of DESEO CLUB, which I heard is normally a nightclub home to groovy cumbia when it’s not filled with nerds, figures like legendary technologist Richard Stallman and Eva Galperin of the Electronic Freedom Foundation delivered stump speeches that went on a little too long. Peter Van Valkenburgh, Executive Director of the DC-based crypto advocacy group Coin Center, made the case for replacing the Bank Secrecy Act and anti-money laundering statutes with decentralized code, peppering his oratory with Trump-y words like “bigly.” And Ethereum founder and wunderkind(-turned-adult) Vitalik Buterin provided a demo of a new privacy-focused wallet protocol, donning a short-sleeved dress shirt pasted with cartoon drawings of Internet-famous Thai hippo Moo Deng. It was decidedly not a bank-friendly or particularly pro-state environment.
But the next day, in the same hippo-stamped uniform, just with long pants this time, Buterin provided a 30-minute update on Ethereum’s multi-year roadmap before a packed room. Speaking onstage at La Rural, a convention center a 10-minute drive from the city’s domestic airport, Buterin shared the Ethereum Foundation’s work to bolster the Ethereum blockchain’s capacity to handle transactions, while also solving for security and privacy.
At the end of the speech, the conference’s emcee boldly asked Buterin what he made of Wall Street’s increasing use of Ethereum. (Things like RWAs, tokenization, stablecoins, etc.) Buterin responded curtly and pseudo-diplomatically, saying that Ethereum is pro-user, and Wall Street is a user, leaving the audience to use the transitive property to understand that Ethereum’s leaders are maybe, sorta, open to accepting major incumbent institutions’ participation in blockchain-based initiatives.
What does Ethereum’s ideological core make of this redoubled effort to engage with the boogeyman that is Wall Street? My running theory is that, at this point, they’re not making too much of it. Many of Ethereum’s staunchest ideological spats — like those of many movements — seem directed inward. I asked one Cypherpunk Congress organizer who didn’t recognize the names of any of the Wall Street crypto influencers I mentioned, but happily soliloquized about the ideological nuances of open-source versus copy-left software. Even the relative appreciation in Ethereum’s value as a crypto asset seemed ancillary to these figures, though I wasn’t entirely convinced by that.
Regardless, disinterest in debating buttoned-up institutions felt like it flowed both ways: institutions looked to steer clear of the cypherpunk-y noise and just get down to business. On Monday, I was invited to a semi-formal — notable attire for crypto — soirée hosted by Cosmos Labs and Interop Ventures at Palacio Duhau, a swanky hotel restaurant in the city’s Recoleta neighborhood. (The British band Oasis was dining in the private room next to ours.) I broke bread with figures like Maghnus Mareneck, Cosmos’s CEO, podcaster and investor Sébastien Couture, and Michael Kirchner (no relation to the Argentine dynasty) an associate partner at McKinsey focusing on fintech and digital assets.
[We all ate the same three courses, except for the vegetarians/vegans. Burrata to start, nestled over an eggplant caponata accompanied by a somewhat desiccated focaccia; a perfectly medium-rare Aberdeen Angus loin thereafter, served alongside a truffled mashed potato blend, much tastier than the chuck and spuds I devoured on my American Airlines flight to Dallas the night thereafter; and rounded out with a dulce de leche crème brûlée, lovely, though served with US-portioned dollops of mascarpone, which I could have done without. Salentin Reserva Malbec and Chardonnay for the table.]
Cosmos is something of a blockchain for blockchains, enabling different protocols to interact with one another. It’s also working with a range of Latin-American governments to power their central bank digital currency (CBDC) projects: the kind of state-centric initiatives the Ethereum ecosystem’s libertarian framers would openly deride.
Yet, at Cosmos’s offsite event, “Sovereign Day,” hosted at Malloy’s Costanera, a waterfront venue an eight-minute drive from the main convention center, the group clearly tried to keep alive the idea that blockchain technology is a liberatory force. The Internet provides “FREEDOM THROUGH CODE,” event copy argued, helping humanity reach “new levels of sovereignty.” Cosmos copy also pointed to crypto’s function as a store of value: a bulwark against Argentina’s hyperinflation, enabling average consumers to hold onto their wealth, or even grow it, even as domestic monetary conditions made the country’s currency plummet in value. (Two conferencegoers I talked to went so far as to call the Peso a “shitcoin.”)
These oblique spats or attempts to shape the Ethereum ecosystem, and the crypto community writ large, are still happening against the backdrop of rampant illegal activity. Just earlier this week, reporting by the New York Times uncovered tens of billions of dollars in fraudulent activity across crypto exchanges — supposedly the more reputable ones — like Binance, Coinbase, and OKX, occasionally flowing to North Korea, al-Qaida, and other decidedly non-OFAC-compliant entities. That 800-pound gorilla of criminality loomed over this foray into blockchain subcultures and worldviews, and was rarely named or tackled head-first. Instead, it was primarily discussed by insider-interlocutors with an air of annoyance. Why is the “mainstream media” still so focused on illegal activity within crypto, rather than all the great things people are doing or all the cool tooling being built? Why doesn’t the non-trade press give crypto a fair shake?
That’s not to say the incumbent financial system is angelic and free from laundering and fraud. But if crypto hopes to stand as the stronger alternative, it has to prove it — and the ongoing churn of scams and illicit flows suggests that proof is still missing. Whether cypherpunks congregating in a cumbia dance hall might lead that charge, or whether semi-formal financiers on the waterfront will become that ruling class remains to be seen. Who has deeper pockets, but also deeper conviction?