Vitalik Buterin says $100M security needed before rollups decentralise

Ethereum (CRYPTO:ETH) co-founder Vitalik Buterin emphasised that rollup-based layer-2 platforms should only decentralise once their security proof systems are strong enough to make centralisation a greater risk than decentralisation.

In a May 5 post on X, Buterin explained that the timing of decentralisation depends on how low the probability of proof system failure is compared to risks introduced by centralisation.

His comments responded to Loopring CEO Daniel Wang, who proposed a “BattleTested” metric for rollups that have secured at least $100 million in assets for six months, including $50 million in Ether and a major stablecoin.

“Not all code is created equal. A rollup can be Stage 2, but running fresh code that’s never been tested under real stress,” Wang noted.

Rollup development progresses through stages zero, one, and two, with stage two representing full decentralisation and trustlessness.

“A good reminder that stage 2 is not the only thing that matters for security: the quality of the underlying proof system matters too,” Buterin added.

Analyst Dominick John from Kronos Research said that transitioning responsibly requires assessing correlated risks like shared custody weaknesses and geopolitical chokepoints.

“The real green light for decentralisation comes not when the proof system looks good on paper, but when it proves under real economic pressure that it’s more reliable than the potential for coordinated failures among council members,” he said.

Buterin concluded that decentralisation should occur only when centralised components become the bigger threat due to their failure or collusion risk.

Mike Tiutin, CTO at PureFi, warned that “going decentralised too early can leave users vulnerable.”

Experts also highlighted that some Ethereum layer-2s remain fundamentally custodial, with privileged entities controlling core logic, which raises concerns about asset security.

Yishay Harel, CEO of Dymension, noted that Ethereum’s original design was not intended to settle rollups, creating tradeoffs between speed of decentralisation and system stability.