Ethereum co-founder Vitalik Buterin expressed his views on Sweden and Norway’s abandonment of the concept of a fully cashless society, emphasizing the importance of decentralized solutions in the payment sector. His remarks came against the backdrop of an increasing reliance on digital payments in these countries and their vulnerability to infrastructural threats.
This is reported by Business • Media
Issues with Centralized Payment Systems in Sweden and Norway
In Sweden, the share of cash transactions has decreased to 1% of all transactions, while in Norway, the main payment tool has become the Vipps app. At the same time, geopolitical instability, particularly due to Russia’s invasion of Ukraine, has demonstrated how vulnerable centralized digital payment systems can be to attacks on critical infrastructure.
“The Nordic countries are retreating from the cashless society initiative because the centralized implementation of this concept has proven to be too fragile,” Buterin wrote on the X platform, responding to a piece by The Guardian.
Buterin emphasized that cash remains necessary as a backup tool, especially in cases of potential failures of digital systems. In his view, decentralized platforms like Ethereum could become a future alternative to cash payments; however, a number of technical issues need to be resolved, including ensuring functionality without electricity and internet access.
Prospects for Ethereum as an Alternative to Cash
Buterin stressed that to achieve this goal, the Ethereum platform must become more resilient and ensure a high level of privacy. According to him, this is only possible after overcoming technological challenges.
Opinions within the cryptocurrency community are divided. For instance, Phoenix Labs CEO Sam MacPherson claims that Ethereum is already resilient to hostile actions, and DeFi protocols manage billions of dollars without serious disruptions. Meanwhile, other experts believe that the lack of offline functionality remains a major obstacle. Although technologies like zero-knowledge proofs may enable autonomous transactions, they are still in the experimental stage and require reliable hardware.
Additionally, a promising area of development is seen in stablecoins, which are tied to fiat currencies and not dependent on a single centralized issuer. However, for Ethereum to become a true digital alternative to cash, issues of privacy and accessibility in emergencies must be addressed.
Analysts note that there is still much work ahead before Ethereum can fully replace cash transactions.