“Vitalik Buterin never understood PoW mining,” says Bitcoin exchange founder

Vitalik Buterin, co-creator of Ethereum and main promoter of the proof of participation (PoS, for its acronym in English) for this network, seems to be not entirely clear “how the proof of work” (PoW) of Bitcoin mining works and others. cryptocurrencies, according to a businessman.

Brandon Quittem, bitcoiner and founder of the company Swam.com, collects several tweets written by Buterin in which he expressed himself about proof of participation and against proof of work.

It is noted that he maintains that idea since 2014, before Ethereum was launched. However, having a “tunnel vision” as Quittem argues, has prevented the creator of Ethereum from changing his perspective on PoW.

In several of the collected tweets, Buterin mentions that the Coin hashrate with PoW can be “captured” by large mining companies. To this, Quittem counters that anyone can buy an ASIC S9 miner for about $200, and mine Bitcoin. Instead, for Ethereum, staking asks to deposit 32 ETH, approximately $60,000, at the time of this publication.

However, there are alternatives for those who do not have the 32 ETH, such as staking pools. Nevertheless, this type of platform implies that it is a third party who will manage the validator nodes, not the user. That is, the platform makes staking with the money of the users.

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Staking pools can centralize Ethereum

Those running an Ethereum 2.0 validator node are forced to always keep them online. A simple downturn in the internet will lead to small penalties that will be deducted from the 32 ETH in staking. Behavior deemed dishonest (attempting to double spend) may result in a penalty for all staked funds.

Quittem argues that this is the main reason why users decide to “outsource” staking, through pools.

Since these platforms literally manage the funds of the users who deposit in staking, they can do with that money what they want. Buterin considers that this type of platform will not have “motivation” of use the money of its users thanks to the penalties (slashing) that exist in the Ethereum protocol.

However, these scenarios led Ethereum 2.0 to enter centralization. According to data displayed by Quittem, 67% of the ETH in staking pools is on regulated platforms. “Hopefully, the US government doesn’t sanction these entities (or force them to implement KYC),” says Quittem.

Platforms like Lido staking pool have been accused of collaborating in this centralizationwhich has led them to work on tools that counteract this scenario, as reported by CriptoNoticias.

“Staking is more vulnerable than mining,” says Quittem

Buterin commented that “physical PoW is easier to attack than digital PoS”, since a mining farm can be closed down, a case that has already been seen with the persecution of miners in China.

However, Quittem argues that for a PoW attack to exist, a coordinated global effort is required, which could be extremely expensive. Instead, PoS is heading into what he classified as a “funding trap” in which few platforms have the majority of ETH staked. Here the digital attack would be much cheaper and “difficult to stop”.

Quittem ends by commenting that PoW allows you to have “non-political money”. Anyone can own a PoW miner, be it GPU or ASIC. According to Quittem, there is a social consensus that “PoW is bad”, but not under good arguments, but only under the logic that Buterin believes so.

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