Hours after issuing scathing criticism of the Ethereum network, Three Arrows Capital CEO Zhu Su retracted his comments. He claimed that the previous post had been made in the “heat of the moment”. In a Twitter feed Posted a few hours after the original, Su apologized for the blast and claimed there were “big teams working on scaling ETH to L2”.
The CEO went on a Twitter rampage against Ethereum on 21 November, where he claimed to have abandoned Ethereum just as “Ethereum has abandoned its users despite supporting them in the past.” He also suggested that the network team was suffering from the “founder’s dilemma,” which made them forget the original goal of making finance accessible.
Su had received intense criticism over his initial tweets, with both enthusiasts and industry proponents calling out the exec for his outburst. In response, he now claims that it was “triggered by a small subset of people and must respect that they do not represent the community at large.” He seems to have been referring to a tweet by Synthetix creator Kain, who called out people who have “sold out in pursuit of profit maximization” in a November 20 tweet.
Earlier this month, Three Arrows Capital was announced as an investor in Blizzard, a fund aimed at promoting the development of Ethereum’s competitor, Avalanche. This had resulted in the protocol reaching the crypto top 10 by acquiring new highs. In his tweet, Kain claimed that those who leave ETH for such platforms will return to Ethereum once scalability is provided by Layer 2 protocols.
Complete u-turn
In his apology, Su claimed that he did not seem to have solutions to the problems faced by Ethereum, adding,
“The millions of new users who are arriving should not be ashamed of going to other ecosystems. Developers shouldn’t be ashamed to rely on them either.
The problems highlighted by Su are all related to the high gas fee the network charges for each transaction. The Ethereum network was unable to scale up to its adoption, resulting in congestion issues and higher fees. While Layer-2 solutions have emerged in the recent past to tackle these issues, they are yet to reduce the fee as significantly as expected. About this, Su argued,
“It costs $ 2,000 to buy a domain name today. Thousands to deploy contracts. Simple send of tokens costs $50. This is dystopian and should be treated as such–instead, it is celebrated bc of the fee burn. This is a rentier mentality and I think it’s dangerous.”
He went on to say that DeFi was created to bank unbanked people, and ETH supporters at the time criticized Bitcoin for its exorbitant transaction fees. Instead, ETH’s high fee had now turned it into an elitist institution for the rich, with huge amounts of users shut out.
In 2014, ETH co-creator Vitalik Buterin said that “the internet of money” should not cost $ 0.05 per transaction, ”compared to Bitcoin. Fast forward to today, the Ethereum gas fee is around 0.012ETH, or $50 per transaction.
An ETH developer, Tim Beiko, supported Criticism of Su in acknowledging her concerns about high gasoline costs and lower than expected adoption rates. He also ensured the executive that a “lot of smart people working on Ethereum” to fix its issues.
