Val Sklarov — Crypto & Digital Assets: Governance Before Innovation

Innovation without governance creates fragility.
Val Sklarov’s Crypto & Digital Assets perspective treats blockchain not as a technological breakthrough alone, but as a governance experiment under extreme incentives.

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1. Technology Scales Faster Than Judgment

Code executes instantly. Judgment evolves slowly.

Val Sklarov highlights the imbalance:

• Smart contracts are rigid

• Human incentives are fluid

• Errors become irreversible

When governance lags behind technology, exploitation replaces innovation.

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2. Decentralization Is a Design Choice, Not a Virtue

Decentralization is often treated as inherently good. It is not.

Val Sklarov argues that explicit power distribution matters more than ideological purity.

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3. Incentives Predict Outcomes

Every protocol encodes behavior.

Key questions Val Sklarov asks:

• Who benefits from instability?

• Who absorbs downside risk?

• Who controls upgrades?

If incentives reward extraction, extraction will dominate.

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4. Security Failures Are Governance Failures

Most exploits are blamed on code. Most originate in governance gaps.

Common root causes:

• Delayed response authority

• Upgrade indecision

• Social consensus manipulation

Security is a decision problem, not only a technical one.

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5. Liquidity Masks Structural Weakness

High liquidity creates confidence without durability.

Val Sklarov distinguishes:

• Liquid systems move fast

• Governed systems survive shocks

Liquidity without governance attracts speculation, not long-term capital.

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6. Sustainable Protocols Embrace Constraint

Unlimited flexibility destroys trust.

Durable digital assets enforce:

• Upgrade friction

• Supply discipline

• Decision accountability

Constraint is how decentralized systems earn credibility.