Limitations of the Encryption Foundation and Opportunities in Emerging Enterprise Architecture

The encryption foundation was once a key force in promoting the development of blockchain networks, but it has now become an obstacle to progress in the industry. With the emergence of a new regulatory framework from the U.S. Congress, the encryption industry has welcomed an important opportunity: to abandon the encryption foundation model and reconstruct the ecosystem with a clearer and more scalable mechanism.

The encryption foundation model originated from the decentralized idealism of early founders, aiming to serve as a neutral manager of network resources. However, with changes in the regulatory environment and market competition, this model has deviated from its original intent. It has led to issues such as misaligned incentives, constrained growth, and the entrenchment of control.

The encryption foundation lacks a clear accountability mechanism and market constraints, making it difficult to achieve effective resource allocation. In contrast, corporate structures have inherent accountability mechanisms and are constrained by market laws, which can better optimize resource utilization. The legal and economic constraints of the encryption foundation also limit its ability to create value.

The encryption foundation has also resulted in significant operational efficiency losses. To meet formal separation requirements, efficiently collaborating teams have been forced to split, affecting product development and marketing. In addition, the encryption foundation has gradually evolved into a centralized entity controlling key functions, contrary to its original intention.

Under the new regulatory framework, conventional development companies may become a better choice. Companies can allocate capital more efficiently, attract talent, and respond to market demands. By using tools such as public welfare company structures, revenue-sharing mechanisms, and milestone attribution, a long-term synergy can be established between company interests and network development.

The emerging decentralized non-corporate non-profit association ( DUNA ) and the cybernetic organization ( BORG ) provide effective means for implementing these solutions. DUNA grants DAO legal entity status, while BORG shifts governance functions to run on-chain.

Looking to the future, the encryption industry needs to establish a scalable system based on genuine incentives, accountability, and decentralization, rather than relying on expediency. A new corporate structure is expected to drive the industry towards the next stage of development.