Ethereum 2.0 comes out of the emergency by centralization

Ethereum 2.0 comes out of the emergency by centralization

Key facts:
  • Prysm is still the most used client, although no longer at emergency levels.

  • Developers celebrate the progress, but point out that there is still much to improve.

Just over a month after reaching “emergency” levels, the Ethereum 2.0 network has decreased the level of client centralization used by staking pools. Prysm, the top pick, now has less than 62% dominance, so it no longer includes two-thirds of validators on the network.

As of the end of February 2022, 67% of Ethereum 2.0 validators were using the Prysm client, which bridges the nodes and the blockchain. As CriptoNoticias reported at the time, this implied a very dangerous level of centralization for the network, since a failure with this client would put it at risk.

Currently, the site data pools.invis.cloud they present a less urgent picture. Although the change in the last 35 days has not been resounding, but “barely” 5% less, it’s a positive sign noted by experts like developer Justin Drake. In a publication On Twitter, Drake celebrated the fact that Prysm is no longer serving more than two-thirds of validators. This is a key number as it is the fraction of validators needed to validate and record transactions on the blockchain.

Ethereum 2.0 comes out of the emergency by centralization
Justin Drake shared a meme to celebrate the progress in the decentralization of Ethereum 2.0. Source: @drakefjustin/ twitter.com

Similarly, the developer superphiz.eth wrote on the same social network a message alluding to this fact. “Thank you to all the voices and actors who brought the diversity of Beacon Chain down to a minimally viable ratio for the merger. Now we can avoid catastrophic failures, but we still need greater equality. This is the beginning of a new era of decentralization! », Was the message from him.

However, Not all Ethereum specialists agree on this issue. The promoter and publisher of Week in Ethereum Evan van Ness manifested that the ideal would be that «no client has more than 33% of the market». “Right now, that means stopping using Prysm and Geth,” he added.

Why is centralization dangerous in Ethereum 2.0?

When Ethereum completes its transition to the new version 2.0, the network will stop validating new blocks through proof of work or proof of work and will start using Proof of Stake. To participate, validators must deposit 32 ethers (ETH), the Ethereum cryptocurrency, or be part of a staking pool.

In these pools, various ETH holders combine their resources to have a better chance of being selected to validate a block. Something similar to what happens in mining pools (PoW). In turn, these pools use third-party services, the clients, to connect to the blockchain and thus send and receive information.

Prysm is currently the most used client, as mentioned above. Major staking pools, such as Coinbase, Binance and Kraken mostly operate with this client. Until recently, more than two-thirds of validators used Prysm. That is precisely the number of validators needed to approve new blocks.

This centralization in data management is dangerous for several reasons told by this medium in the February article cited above. For example, if the client has operational failures or, worse yet, is compromised by attackers, the entire network would be compromised.

This could also lead to corrupt validators being able to dishonestly confirm new blocks. In turn, such an event could lead to the burning of ETH in staking (the chain itself penalizes dishonest attempts to validate transactions) or to a fork of the blockchain, which would be left with incorrect information recorded forever.

With the arrival of Ethereum 2.0 already on the horizon and in a few months, at least according to the promises of specialists, these issues are beginning to have more and more importance. The developers know this and the pools do too, which is why they committed to diversifying their choice of clients to keep Ethereum decentralized and secure.

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