The blockchain space is abuzz with the resurgence of private, permissioned blockchains, but one voice stands out as a vocal critic of this trend: Vivek Raman, CEO of Etherealize. In a recent interview, Raman warns that the rise of these 'consortium chains' risks recreating siloed systems that undermine the very interoperability and liquidity that blockchain technology was designed to enable. This is a critical issue, as it threatens to fragment the blockchain ecosystem and limit the potential for widespread adoption.
Etherealize, backed by the Ethereum Foundation and Ethereum co-founder Vitalik Buterin, is pitching Ethereum's open mainnet as the neutral base to which institutions can add permissioned and privacy-preserving features at higher layers. This approach, in Raman's view, is the only way to truly unlock the potential of blockchain technology. He likens Ethereum's mainnet to the HTTP layer of the internet, while permissioned chains are like HTTPS, which adds security and privacy but at the cost of interoperability.
The rapid uptake of gated networks by major firms, such as Digital Asset's Canton Network, Circle's stablecoin payments play ARC, and Stripe's vertically integrated Tempo blockchain, is a cause for concern. These systems tout their inherent privacy and reduced counterparty risk, which mainstream finance finds attractive. However, as Raman points out, these systems have been around in one form or another for years, and early adopters may recall the reams of banks that joined R3's consortium effort back in 2016. Unfortunately, R3 didn't make it to the end of the year before the big banks like Goldman Sachs, Morgan Stanley, and Santander withdrew from the system.
Raman believes that the market's apparent disregard for decentralization and the aims of the blockchain originators is a critical issue. He argues that the rapid adoption of gated systems with clear sponsors suggests that the market is prioritizing enterprise sales over the broader benefits of blockchain technology. This is where Etherealize comes in, as the company aims to attract traditional finance (TradFi) firms to Ethereum's permissionless ecosystem, where all transactions are visible to everyone.
The company was seeded by a grant from Ethereum co-founder Vitalik Buterin and the Ethereum Foundation in January 2025 and raised $40 million in Series A funding later the same year. The recent announcement by BlackRock of its new Ethereum-based funds is a sign of things moving in the right direction, according to Raman. He believes that when regulatory clarity is achieved, institutional money will flow towards open networks because they are the rails that no one owns. In contrast, consortium chains require permission or membership, and the incentives for early adopters quickly diminish.
In conclusion, the resurgence of private, permissioned blockchains is a critical issue that threatens to fragment the blockchain ecosystem and limit the potential for widespread adoption. While these systems may offer privacy and reduced counterparty risk, they come at the cost of interoperability and liquidity. As Raman argues, Ethereum's open mainnet is the only way to truly unlock the potential of blockchain technology, and Etherealize is working to make this a reality.
