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Ethereum creator Vitalik Buterin and fellow developers just sat down with Tech Crunch to talk about scaling, one of blockchain’s make-or-break challenges.

Buterin was asked about his thoughts on the Ethereum-based decentralized app CryptoKitties, which became so popular late last year that it bogged down the Ethereum network. The conversation then turned to Bitcoin’s overall adaptability, the community’s decision-making challenges and mining pools.

What was your reaction – economic reaction – when you saw that the network started to be so congested because of CryptoKitties and because of the massive uptick in Ethereum transactions?

“To me, it just highlighted that demand for using public blockchains is high, and we basically need to really step up our game in terms of increasing scalability in order to be able to meet that demand.”

It feels like Bitcoin is a bit stuck in a corner. It’s like a cryptocurrency with no head, and they don’t have a way to pass some decisions together as a community.

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“Bitcoin has plenty of heads. You have the core development team. Then you have the miners with Bitmain-associated pools having 53% of the hash power. Can they agree? No. I mean, you have gridlock.”

Do you think at some point you could face the same kind of issues – the same kind of gridlock?

“Very possibly, definitely. This is part of the reason why I think the Ethereum community very early on has been – both us and Ethereum developers and people in the community in general – have been continuing to promote the idea of the Ethereum roadmap. And basically, I feel like in the eyes of most people in the Ethereum community, the roadmap is part of the social contract. And that includes the idea that proof of stake will be done. That sharding will be done. That there will be much more efficiency. That there will continue to be upgrades going for some time into the future. And people who buy into Ethereum basically buy in knowing these are the things that people are going to want to push forward.

So when people join the community and start building applications on it, they can know that they are doing this on a blockchain and inside of a community that is dedicated to continuing progress. So there may be deadlock on what specific path the community should take, but I do feel like we’ve made the very important step of basically committing not to stagnate. And, I think, for a platform that’s still a rapidly evolving technology in a rapidly evolving industry, that’s a fairly important commitment to have.”

Buterin later explained why he believes decentralized cryptocurrency exchanges are far superior to their centralized counterparts.

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Do you think there’s a chance that down the road decentralized exchanges will be where the majority of the action is and centralized exchanges were like an ephemeral blip? Or do you think they’ll be a bizarre occasional use case?

“I definitely personally hope centralized exchanges burn in hell as much as possible. First of all, clearly I think on the fiat-to-crypto side it’s very difficult to decentralize because you ultimately are interfacing with the fiat world, and the fiat world is one that only has basically centralized gateways. So I do think that there’s valuable services that are being provided there that are very hard to decentralize.

On the crypto-to-crypto side, I do think that it’s still early days and the technology is going to become more and more efficient over time. And at some point we are going to see a world where it becomes much easier to fairly quickly turn a token of one kind into a token of any other kind.

Basically, with the decentralized exchanges available today, one of the nice things is they already have a nice usability gain, which is that you don’t have to register, log in, create an account, go to some stupid web interface. All you do is you just send tokens of one type to one address, and then you immediately get tokens back from another address. From a user experience point of view, it’s great. That is obviously something that needs to be refined a lot more around the edges, but I think it’s something that we are going to start seeing more and more of.

Now, where large-scale traders, professional traders, the high-frequency trading ecosystem and so forth are going to go, that still remains to be seen.”

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You can watch the first interview here, and the second one-on-one interview here.

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