Crypto companies should put survival and security first over the next two years, Ethereum co-founder Vitalik Buterin said Thursday, Nov. 5, as attacks continue to expose risks across the industry.

Buterin said smart-contract vulnerabilities and attacks have declined. Most major hacks over the past 18 months, he said, were concentrated in user interfaces and centralized components. He described core infrastructure as becoming more secure and the range of infrastructure able to offer stronger safeguards as expanding. Attacks are still occurring, he said.

Buterin expects large trading platforms, custodians and other financial institutions to move more operations on-chain, where users can carry out activity through smart contracts. He cited Binance’s launch of BNB Chain as a sound decision, saying users operating on-chain can benefit from the security of blockchain infrastructure. He expects more institutions to move in that direction.

Buterin said those security gains will not automatically lead to safer businesses. People who do not prioritize security may use efficiency gains from artificial intelligence, larger teams or stronger technical capabilities to pursue more aggressive business instead of improving safeguards. He called that a practical challenge even as more operations can be handled on infrastructure offering stronger security.

If security problems reach a certain level, Buterin expects regulators and industry leaders to demand greater responsibility and more cautious business practices. He said industry regulation and accountability mechanisms are moving toward requiring companies to place greater emphasis on security, and that participants are adapting to this shift.

The Ethereum Foundation has been providing code and tools for safer options, including code for quantum-safe signatures and support for wallets protected by quantum-safe technology. Buterin said users must recognize the risks and choose to enable those protections.

Simon Yoon

Simon Yoon reports on blockchain technology for TokenPost. Send corrections or tips to [email protected].